Whatever happened to the Long Tail?

If you have been interested in the evolution of digital content, you may remember the Long Tail. This was a theory that saw life as an article by Chris Anderson in Wired magazine, and then as a hit book released in 2006. The theory states that so-called brick-and-mortar shops only carry a limited amount of stock, and they tend to prefer stocking big sellers. Digital markets allow for unlimited choice as there is no constrain to what the store could offer. Anderson proposed that “in an era without the constraints of physical shelf space and other bottlenecks of distribution, narrowly targeted goods and services can be as economically attractive as mainstream fare.” This would mean that the market for non-mainstream products could very well outstrip the demand for content that is only present in the traditional stores. He explained:

“When consumers are offered infinite choice, the true shape of demand is revealed. And it turns out to be less hit-centric than we thought. People gravitate towards niches because they satisfy narrow interests better, and in one aspect of our life or another we all have some narrow interest (whether we think of it that way or not).”

The reception to the Long Tail was mixed. On the one hand, it was celebrated by the technophiles as a true description of the media markets of the future, where niche acts would be able to get more money by having access to digital markets, bypassing the old gatekeepers. On the other hand, the theory was heavily criticised by some people who often tend to favour the status quo, as it was seen as a challenge to existing business models.

While evidence began to mount in both camps, it was clear that something interesting was happening to the entertainment industry, we just did not know exactly what. However, criticism of the Long Tail started to increase, and in 2008 an article by Anita Elberse in the Harvard Business Review dealt a massive blow to the theory. Elberse became the champion of the blockbuster approach of doing business, which had produced content for decades on the presupposition that most of the investment should rely on a few hits. She found that while it was clear that there was a long tail, it was shallower and flatter than Anderson had expected, with massive concentration in the head. She looked at the data from music service Rhapsody, and found that “the top 10% of titles accounted for 78% of all plays, and the top 1% of titles for 32% of all plays.” This was a great level of concentration that seemed to disprove the Long Tail. Her final advice for producers and retailers was to continue to invest heavily on blockbusters.

This was a depressing outcome for many of us who, perhaps naïvely, thought that digital markets would bring about a democratization of content creation and distribution. Instead of investing more in niche artists and alternative content, producers were told that they should continue shooting for the lowest common denominator, taking fewer risks expecting to attract massive results. In a follow-up book called Blockbusters, Elberse continued her relentless attack on the Long Tail, offering more insights about why we were not witnessing the digital revolution envisaged by Anderson. One of the main reasons for the continuing reliance on blockbusters was that it was simply more economically sound to invest on recognized names, and advertising investment continued to go to the high earners, making it a self-fulfilling prophecy.

As more data emerged, it began to destroy many of the promises of the digital revolution, as the content industries continued to rely on the superstars. The Long Tail was declared dead when it emerged last year that the top 1% of music artists account for 77% of all artist recorded music income. It is easy to understand such figures if one knows about networks and the Matthew Effect, the theory that states that the rich get richer, which can be explained by a continuing accumulation of links from a node in a network that already has an advantage in incoming connections (shameless plug for my book).

So, is the Long Tail really dead?

I would argue that at least in some markets like books, film and TV, the death of the Long Tail has been largely exaggerated. While the book market still relies on blockbusters, data released by Amazon indicates that at least one-quarter of the top 100 e-books on Kindle come from independent publishers, with the occasional self-published book making it to the top 100, something that would be unheard of with physical books.

In film and TV, we have witnessed a revolution thanks to digital services such as Netflix, Amazon Prime and iTunes. It may seem counter-intuitive to call large Netflix hits such as House of Cards, Daredevil and Orange Is The New Black as Long Tail candidates, but this type of content fulfils the definition of non-mainstream and non-physical store content that exists only because of digital markets. It is possible that a few of those shows might have been picked up by traditional producers, but their existence in Netflix proves that the Long Tail was correct in predicting that digital outlets would enrich the media landscape. I cannot imagine that a show as daring as Sense8 would have been made by any mainstream producer.

Netflix maintains their viewer figures secret, but some analysts have tried to use other methods to learn what is going on with the streaming video provider, and have found that a show like Daredevil was watched by 10.7% of subscribers. With a global user base of 65 million subscribers, we are talking about at least 6 million households for a show that is not available elsewhere. As a matter of comparison, the season finale of Doctor Who was watched by 6.34m viewers in the UK.

All of the data seems to show that the music market is definitely a blockbuster environment with disproportionate accumulation of hits from a few acts. However, it could be possible that things will change as more and more people listen to music through streaming. It is still difficult to get raw data about listening patterns in streaming services like Spotify and Apple Music, such figures are still a heavily guarded secret. However, we can see some interesting patterns beginning to emerge. Spotify data confirms that hit albums receive considerably more money than a niche indie album, over 100 times more.

It is possible that the music market is geared towards the superstar model. Radio is still a very important source of discovery for many people, and radio stations tend to play established acts. Niche independent radio stations simply do not have the same reach as mainstream ones. Just for comparison, in the UK the two main music radio stations are BBC Radio 2 and BBC Radio 1, with 15 million and 10 million weekly listeners respectively. Radio 6, the indie station, has managed to grow to 2 million weekly listeners, but it still does not have the same reach as the others. This would undoubtedly translate into listening figures in streaming that favour the superstars.

We may also be looking at Iat a market before maturity. Music streaming has the potential to display Long Tail characteristics, but listening figures are not yet there. It is possible that the curated lists and the music station model that is being implemented by Apple Music may drive more traffic towards the tail.

For the time being we will continue to enjoy the golden age of TV brought about in part by the Long Tail.