Slashdot Mirror
Harvard Study Questions "Long Tail" Theory
mjasay writes "Remember 'the long tail?' That was the idea that there was gobs of money to be made in the more obscure tastes of any given market, enabled by the web. In recent research highlighted in the Harvard Business Review, however, the long tail theory comes under withering criticism. Not only is a hits-based business more profitable for vendors according to the new research, but the research suggests that consumers also derive more enjoyment from the hits, rather than the tail. In short, the researchers find that 'the tail is long and flat, and therefore that content providers will find it hard to profit much from it.'" Long Tail advocate Chris Anderson defends his theory, and it seems that most of the debate centers around how you define "head" and "tail."
A lot of the bubble wasn't due to the theory. It's failure was do to bad business. The We Sell Each Product under cost's we make it up by selling more of them. Or lets do it over the web it is only 3 times as harder to do it there then a person can do at home. And the concept a CS degree will help the company more then an MBA. SCREW PROFITS WE WANT COOL TECH!
After the bubble pop the net matured a bit. People didn't jump in thinking they will be rich, just enough to get by. The moderating approach is what saved the net echonomy. the 1990's everyone was trying to get Rich! Rich!! Rich!!!
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
Long Tail advocate Chris Anderson defends his theory...
You mean, this Chris Anderson? The "science is now useless because we have teh cloudz" guy? Yeah, after that gem of scientific insight, lemme rush right over and see what he's prattling on about in the world of finance...
[b.belong('us') for b in bases if b.owner() == 'you']
A specialty store would focus on a wider selection of a particular type of good. So the cheese shop might have 50 varieties, and the plumbing supply place will have 50,000 plumbing parts in stock. The margins here are high, because the customer needs a particular type of a hard-to-get item.
Amazon and iTunes have a business model that scales out enough that they can pay the bills by selling high-volume, low-margin items while making a profit on low-volume high. When you build a giant, automated warehouse in the middle of nowhere, the marginal cost of storing one more book is very low.
Killing the slow-moving stock would kill Amazon, because that's where they make money!
On the other hand, carrying high-volume, low-margin items in a speciality retailer can kill the business. If a high-end steakhouse started selling $3 roast beef sandwiches, their customers would either leave, get crowded out by people buying sandwiches or stop buying $50 steaks.
Conformity is the jailer of freedom and enemy of growth. -JFK
I'm not familiar with how "the long tail" is normally used, but TFA definitely isn't about copyright lengths. The article's "long tail" refers to obscure products with less sales potential.
For example: very few people like accordian music. So few people that if you built a "brick and mortar" shop dedicated to accordian music, you'd likely go out of business. It's probably not even worth stocking accordian music in a regular record store. The internet, however, gives you a broader reach so you can profitably sell accordian music because you're not limited to your tiny local area. That's the "long tail" as described in the HBR article.
Maybe not