Gustavo Ballvé on January 25th, 2011
Corporate Strategy, Food for thought, Home, Industries, Investment Themes, Media, Portfolio Management, Retailing

Chris Anderson’s “The Long Tail” (2006) is a great book about the power of choice enabled by the Internet – which “created” significant markets out of the deepest niches. His first example was the music industry, long in need of respite from ever-decreasing CD sales.

2011: This New York Times article argues that growth in digital music sales is stalling while sales are still at a level that doesn’t compensate for lost CD revenues, and wonders about the music industry’s “salvation” hopes. Unlike other digital media that are perhaps less prone to piracy, digital music just hasn’t found the right business model yet. Note that this doesn’t dismiss the book at all, it just shows that, in reverse of Mark Twain’s famous line, “the news of the music industry’s rescue have been greatly exaggerated…” Is it strictly a “speed of adoption” problem or does it point to a deeper problem – the long tail not being as long as imagined (or not as long as some industries need it to be) – and if so, what other insights could this yield for the “rest” of the media sector and for e-commerce?

Also check out the original (2004) article at Wired and the Long Tail blog (discontinued in 2009, but still interesting).

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