1. The Long Tail & Paradox of
Choice
Jonathan Wareham

2. The Long Tail: Introduction
What is the Long Tail?
 The long tail is the colloquial name for a long-known feature
of statistical distributions (Zipf, Power laws,
Pareto distributions and/or general Lévy distributions ). The
feature is also known as "heavy tails," "power-law tails," or
"Pareto tails."

3. The Long Tail: Introduction
A brief history of the hit
 New Technologies in the mid- to late 19th century laid the
ground work for pop culture
 Commercial printing technology
 “Wet plate” technique for photography
 1877 – Edison invents the phonograph
 Result: the first wave of pop culture
 Newspapers and magazines
 Novels
 Printed sheet music
 Records
 Children’s books
 Newspapers bring the latest fashions from New York,
London and Paris
 At the end of the 19th century, the moving picture gave the
stars of stage a way to play many towns simultaneously and
reach a much wider audience.
Source: Anderson, C. (2006) “The Rise and Fall of the Hit”, Wired Magazine

4. The Long Tail: Introduction
A brief history of the hit
(continued)
 Such potent carriers of culture had the
effect of linking people across time and
space, effectively synchronizing society.
 Not only did your neighbors read the same
news you read in the morning and know
the same music and movies, people across
the country did too.
 In other words, while culture was
synchronized, it was also homogenized.
Source: Anderson, C. (2006) “The Rise and Fall of the Hit”, Wired Magazine

5. The Long Tail: Introduction
Measuring the hit
 Blockbuster movies
 Billboard magazine Hot 100 songs
 New York Times bestsellers in books
 Forbes lists

6. The Long Tail: Introduction
Driver of the hit culture:
the economics of scarcity
 An average movie theater needs at least
1,500 people over a 2-week run; that's the
rent for a screen.
 An average record store needs to sell at
least 2 copies of a CD per year; that's the
rent for a half inch of shelf space.
 The same applies to DVD rental shops,
videogame stores, booksellers, and
newsstands.
Source: Anderson, C. (2004) “The Long Tail”, Wired Magazine

7. The Long Tail: Introduction
Example: Cinema
 In 2004, nearly 6,000 movies were
submitted to the Sundance Film
Festival.
 255 were accepted.
 24 were picked up for distribution.
 The other 231 may never be seen.
 Who controls the tools of production
and distribution???
Source: Anderson, C. (2004) “The Long Tail”, Wired Magazine

8. The Long Tail: Introduction
The peak of the hit culture
 Between 1990 and 2000, album sales
had doubled, the fastest growth rate
in the history of the industry.
 Half of the top-grossing 100 albums
ever were sold during that decade.
Source: Anderson, C. (2006) “The Rise and Fall of the Hit”, Wired Magazine

9. The Long Tail: Introduction
Decline of the hit
 Total music sales fell during 2000, for
only the second time in a decade.
 Sales fell 2.5 percent in 2001, 6.8
percent in 2002, and just kept
dropping.
 By the end of 2005 (down another
8.3 percent), album sales in the US
had declined 20 percent from their
1999 peak.
Source: Anderson, C. (2006) “The Rise and Fall of the Hit”, Wired Magazine

10. The Long Tail: Introduction
Not enough blockbusters
Source: BoxOfficeMojo.com as posted 17/09/2006 on
the Long Tail blog

11. The Long Tail: The Long Tail and the Internet
What happened? The Internet
 Record labels blame it on Napster and
piracy, but it’s not that simple.
 The Internet’s peer-to-peer architecture is
optimized for a symmetrical traffic load,
with as many senders as receivers and data
transmissions spread out over geography
and time.
 In other words, it’s the opposite of
broadcast.
Source: Anderson, C. (2006) “The Rise and Fall of the Hit”, Wired Magazine

12. The Long Tail: The Long Tail and the Internet
Inventories: physical retail vs. Internet
retail
Total Inventory (songs) Total Inventory (books)
735,000 2,300,000
Total Inventory (movies)
39,000 130,000
25,000
Rhapsody Walmart Amazon Barnes & Noble
3,000
Netflix Blockbuster
Source: Anderson, C. (2006) “The Long Tail: Why the Future
of Business is Selling Less of More”

13. The Long Tail: The Long Tail and the Internet
Sales distribution: Head vs. Tail
Rhapsody Amazon
% Sales from Long Tail % Sales from Long Tail
22%
43%
57%
78% Netflix
% Sales from Long Tail
20%
80%
Source: Anderson, C. (2006) “The Long Tail: Why the Future
of Business is Selling Less of More”

14. The Long Tail: The Long Tail and the Internet
Range of Quality/Satisfaction
Search quality
High
Low
Source: Anderson, C. (2006) “The Long Tail: Why the Future
of Business is Selling Less of More”

15. The Long Tail: Three Forces
The Three Forces of the Long Tail
 The Three Forces of the Long Tail
 Six Themes
 Force 1: Democratize the tools of
production
 Force 2: Democratize the tools of
distribution
 Force 3: Connect supply and demand

16. The Long Tail: Three Forces: Tools of Production
Force 1: Democratize the tools of
production
 Especially using affordable digital
technology that makes it
economically feasible to make
products, even in small quantities.
 This results in “more stuff, which
lengthens the Tail”.
Source: Anderson, C. (2006) “The Long Tail: Why the Future
of Business is Selling Less of More”

17. The Long Tail: Three Forces: Tools of Production
Examples of tools of production
 Blogs – short for Weblog - free technology
for creating an online journal to comment
on topics like food, politics, technology or
any other topic you can think of.
 Photoblog – driven by cheap digital photography
 Vlog – driven by cheap video recording
technology
 Podcast – driven by cheap audio and video
recording technology
 Example: Affiliate Blog by Shawn Collins
 Open Source software.
 e.g. Linux, Joomla, Simple Machines Forum

18. The Long Tail: Three Forces: Tools of Distribution
Force 2: Democratize the tools of
distribution
 Internet aggregators create “infinite
shelf space” businesses where
virtually every product in a category
can be economically accessed.
 This creates “more access to niches,
which fattens the Tail”.
Source: Anderson, C. (2006) “The Long Tail: Why the Future
of Business is Selling Less of More”

19. The Long Tail: Three Forces: Tools of Distribution
Examples of tools of distribution
 Amazon
 NetFlix
 Rhapsody
 iTunes
But also: If you build it, they will come
 Froogle
 MySpace
 YouTube
 Flickr

20. The Long Tail: Three Forces: Tools of Distribution
Examples of tools of distribution
 Youtube – upload amateur videos.
 Driver: cheap video recording technology
 MySpace – social networking site
focused on entertainment.
 Driver: cheap audio and video recording
technology, dynamic user interfaces
 Wikipedia – Internet encyclopedia
that allows users to freely edit its
content.

21. The Long Tail: Three Forces: Connect Supply and Demand
Force 3: Connect supply and demand
 Emergence of businesses and taste
makers that act as filters, helping to
cost-effectively and flexibly connect
people with available goods, no
matter how narrow the interest or
specialized the product.
 This “drives business from hits to
niches”.
Source: Anderson, C. (2006) “The Long Tail: Why the Future
of Business is Selling Less of More”

22. The Long Tail: Three Forces: Connect Supply and Demand
Examples of filters
 Search engines (Google, Yahoo!, etc.)
 Sorting (e.g. Froogle)
 Ratings (e.g. Ciao)
 Reviews/Editor Recommendations (e.g.
Zdnet)
 Peer recommendations (e.g. digg)
 Customer Reviews (TripAdvisor.com)
 Community (e.g. The Lonely Planet Forum)
 RSS content syndication (e.g. NetVibes)
 Tagging

23. Paid search
Organic
search

24. The Long Tail: The Paradox of Choice
The Paradox of Choice
The Paradox of Choice Video

25. The Long Tail: The Paradox of Choice
Questions
 Are you a maximizer or satisficer?
 Provide 3 examples where filters
work & individual choice succeeds
 Name 3 examples where we should
not make our own choices