The Power of the Digital Marketplace

Chris Anderson illuminates in his book, The Long Tail, a true revolution that is occurring in media sales.  Let us consider the music industry.  The trend of "hits" manufacturing is slowly expiring with the presence of greater digital selection.  To better illustrate this, consider a brick-and-mortar music store.  Limited shelf space begets scarcity.  Only so many albums can be accommodated.  As a consequence, "hits" must be propagated to encourage greater sales volume and optimal use of restricted product display.  Selection suffers as a byproduct of this scheme.  

With digital environments such as Rhapsody and iTunes, users are finding a greater selection of music because of seemingly boundless digital "shelf space."  More obscure music is now available and with this selection, a greater spread of purchase behavior.  Let's expound upon this.  A trend now exists in which, as Anderson describes it, less of more is being sold.  Sure, obscure or at least lesser known  songs still may not rival the recent releases of a Jessica Simpson or Eminem, however, the cumulative totals of songs outside the top billboard ambit account for increasing levels of download volume.  This is graphically represented as a "long tail."  Consider the chart above: the vertical axis represents level of popularity (in this case measured by download volume) and the horizontal axis displays the product (in this case individual songs).  The more obscure music is found farther and farther to the right.  While the bulk or head of the graph embodies the top selling albums, notice that though the download volume diminishes with lesser know music, it never reaches zero.  There is still some download activity.  Again, the cumulative total of these downloads, the "long tail," is a considerable sales share.  To more specifically quantify this, Anderson profiles in his book a recent pie graph of Rhapsody's revenue share.  Nearly 40% of its 1.5 million track inventory sales were products not available in offline retail stores.  

The cost-effectiveness of this model is impossible to ignore.  Digital libraries can operate with little overhead and in the absence of expensive distribution schemes.  The internet allows for a powerful, minimal-cost distribution vehicle.  As the internet has grown more and more enriched both as a social medium and a commerce environment, traditional broadcast media has taken a substantial hit, both in the entertainment sector as well as sales/advertising.  Also consider the many cultural implications of this trend.  Perhaps engineered pop culture is a thing of the past and a more heterogeneous, dare I say freethinking culture is being nurtured.