WSJ/HBR: A Manufactured Long Tail Debate?

A friend of mine forwarded Lee Gomes's WSJ article questioning Chris Anderson's Long Tail theory, referencing a recent Harvard Business Review article by Anita Elberse.

Setting aside Lee's original Long Tail skepticism, possibly because it suggested the blogosphere presented an opportunity to impact journalists at the head (e.g. WSJ columnists?); I emailed the following thoughts to my friend. This feels like an attempt by Anita to manufacture some Long Tail controversy to benefit her research/writing, much of her observations actually match what Chris suggested in The Long Tail.

Did I miss something? Any thoughts?

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From: Dan Rua [mailto:dan@inflexionvc.com]
Sent: Wednesday, July 02, 2008 10:19 AM
Subject: RE: Long Tail questioned

Great article. I read Chris Anderson's response earlier this week. I felt he was overly gracious about her attack on the Long Tail, but he did share some nuggets such as: "So in the data she cites, the head of the online music market represents 32% of the all plays, and the tail represents 68%. That's certainly no challenge to the Long Tail theory; indeed, it's even more tail-heavy than the data I cited in my book (probably because I used a more generous estimate of 50,000 tracks for Wal-Mart's inventory)."

I'd share that Lee's WSJ summation doesn't match what I got out of reading Long Tail: "The Web is clearly changing cultural consumption patterns, but those changes don't seem to involve the sort of drastic flattening of demand curves predicted by the Long Tail."

I may have missed Long Tail's punchline, but I didn't read the Long Tail to predict a drastic flattening of demand curves or that hits wouldn't continue to be valuable. Rather, I read it to admit a head and tail exists, but the historically inaccessible (due to physical costs etc.) long-tail can become lucrative because of online zero/low costs of manufacturing/distribution. Google's $5B+ long-tail adsense business is a very concrete example of that opportunity.

It's interesting that the opening "aha" example in the HBR article focuses on physical goods/expense decision-making: Grand Central Publishing spent $7M marketing their top book titles and $650K marketing their other titles, and the top titles were more profitable. That example doesn't even match Long Tail theory which would have suggested spending almost zero marketing the long-tail, but making it available digitally for consumers to find/discover.

Despite the HBR article's attempt at Long Tail controversy, it's nice to see that it ends with advice matching what I got out of The Long Tail in the first place. For example: "1. If the goal is to cater to your heavy customers, broaden your assortment with more niche products. 2. Strictly manage the costs of offering products that will rarely sell. If possible, use online networks to construct creative models in which you incur no costs unless the customer actually initiates a transaction."

I think the combination of Long Tail and this article suggests: 1) there is opportunity in the head and 2) there is opportunity in the tail. I'll buy that.

Cheers,

Dan...

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UPDATE 07/03: Erik over at TechCrunch came away with a very similar analysis shortly after mine. In fact, his summation sounds strangely familiar:

"In the end, Elberse presents a false dichotomy. The choice is not head or tail. It’s both."

Related posts via Techmeme: Matt Rosoff, Michael Masnick, Matt Asay, Alan Patrick, Jackson West, Slashdot, Coolfer, David Utter
Related images: the long tail, chris anderson, anita elberse, lee gomes, wall street journal

WANTED: New Kind of CMS and New Kind of Start Page

I'm looking for a couple things that I'm surprised I cannot find, yet:

1) New kind of CMS, turning your site/blog into your single profile/lifestream/social graph instead of maintaining those concepts across Facebook, Twitter, Friendfeed or elsewhere. There are some lifestream plugins for Wordpress and some one-off integrated design efforts, but this feels like something worthy of a new CMS from the ground up -- the mix of profile and social graph requires rethinking refresh cycles, data location/sharing, and existing blog/page design concepts. Now that APIs are proliferating at a rapid rate, it's possible to create the truly distributed social network -- where we own/control the end-nodes. Any ideas who is closest to this?

2) New kind of Start Page, combining SearchMe's visual pageflows, in-pageflow navigation/scrolling and PageFlakes/GReader RSS organization. The result would be a Start Page for my top 10+ pages of daily consumption, allowing in-page navigation/reading and the aesthetics of coverflow. This may be possible with SearchMe's stacks (still trying), but I'm curious if any other start page platforms are incorporating the coverflow design concepts. Ideas?

I think #1 is a bigger idea, but both would bring me value.

UPDATE: @quangt mentioned Chris Pirillo's new WicketPixie design as coming closer to the SocialCMS I'm suggesting. I really like what Matt Brett pulled together for Chris, but the Social Me and Faves pages are a couple examples of why I think a new CMS structure is in order. There should be a way to incorporate blogging, profiles, and the social graph in a more elegant, inclusive way than just pages/tabs.

Israel, Feldman, Winer, Calacanis, Arrington: Take it to the Fight Club

The never ending drama around puppets is just amplifying what I always suspected about the social media elites. No wonder Ted Murphy scared them so much, he took much worse and handled it much better. Those guys need to take it to a ring...

(via @roder)

Related posts: Mathew Ingram (great recap), Shel Israel, Loren Feldman, BlogHerald, Profy
Related images: loren feldman, shel israel, shel "puppet" israel, dave winer, michael arrington, jason calacanis, puppets

TinySong: Simple, Functional, and Social Music

I love when a product does what it's supposed to, elegantly, and with little additional, complicating function. That is an attribute of many successful products including the original Google search box and Twitter.

I ran across another example recently: tinysong.com

TinySong was created by the music-heads over at GrooveShark, a further extension from their GrooveShark P2P community, to their GSlite player, and now to full-on music sharing across the broader social graph.

Just as TinyURL allows you to shorten long URLs for sharing in Twitter and elsewhere, TinySong does the same for sharing songs for immediate streaming. Although you could argue that TinySong is just a subset of TinyURL (e.g. you could use TinyURL to do the same thing), I see two distinct benefits:
1) Sharing a TinySong.com URL makes it clear to others they are about to click on a song; and
2) TinySong integrates music search, playback and sharing automatically.

The service works as follows. Go to tinysong.com and type in a search term for a song (e.g. artist, title). I chose "party ben":

Select the song you want to share from the search results. I chose "Another One Bites Da Funk" a mashup of Daft Punk and Queen.

Share that tinysong.com URL with others. I shared via Twitter:

Clicking that tinysong.com URL (try it now http://tinysong.com/Aaj) immediately starts playing the song and sharing other details. From here I can listen, playlist, queue for later, share the song further and even download the mp3 for a small fee that GrooveShark splits between all rights holders and the user who shared that song in the GrooveShark community.


So what does GrooveShark get for providing such a nice, little service? New users are exposed to Grooveshark every time they listen to a shared song. The quality of the GrooveShark lite player also guarantees a portion of those visitors will search/play other songs and join the GrooveShark community long-term...

Now I wonder, how long will it take for Twitter, FriendFeed, Twhirl, Spaz or some of the microblogging clients to incorporate TinySong for sharing songs and playing them in-line with a GSmicro player?

Related posts: BlogSounds, KillerStartups, DownloadSquad, MakeUseOf, SarahInTampa, WebsiteMagazine, FreshArrival, TechDigest, AndrewSWise

The Many Models of Music

Wired is one of those rare magazines I usually read cover to cover during the month it arrives. Every now and then I get a nice surprise when I find an old article I somehow missed. Today is one of those days.

David Byrne wrote a brief, yet informative, article about the evolution of music distribution on page 125 of the January 2008 issue. It's a topic I've thought about since the Napster days and I hadn't seen someone map the landscape of artist options as succinctly as David has. He also did a better job than most at describing the music experience our genetics long for, not just a CD or recorded song.

David describes music as:

"Before recording technology existed, you could not separate music from its social context....Music was an experience...Technology changed all that in the 20th century....We'll always want to use music as part of our social fabric: to congregate at concerts...to pass music...to want to know more about our favorite bands....This betrays an eternal urge to have a larger context beyond a piece of plastic."

He then proceeds to share six possible music distribution models, including the varying artist opportunity, problems and control that stems from each.

1. Equity Deal: Every aspect of the artist's career is handled by producers, promoters, marketing people and managers. Example: Pussycat Dolls, Korn, Robbie Williams
   
2. Standard Deal: Label bankrolls recording and handles manufacturing, distribution, press, and promotion. Artist gets royalties and label owns copyright/recordings. Example: Talking Heads, most "big label" artists
   
3. License Deal: Similar to standard deal, but artist retains copyrights and ownership of master recordings. Example: Arcade Fire w/Merge Records
   
4. Profit Sharing: Minimal advance from label for recording costs and minimal marketing, share profits of record sales, not concerts etc. Example: Byrne w/Thrill Jockey
   
5. Manufacturing and Distribution Deal: Artist does everything except manufacture and distribute. Artist has total creative control, but less marketing, bigger risk. Example: Aimee Mann
   
6. Self-Distribution: Music is self-produced, self-written, self-played, and self-marketed. Sold at concerts, online with MySpace promotion etc. Freedom with significant financial constraints -- easier for more established artists. Example: Jane Siberry (Issa), Radiohead

Unlike most commentaries on the music industry revolution, David didn't point fingers or declare superior/inferior models. Rather, he recognized there are different strokes for different folks -- with repeated references to what may be best for new bands versus established bands.

I've always felt the debate between labels, artists and consumers is too black-and-white. The model that works for Radiohead or Coldplay, might be a disaster for a brand new group with minimal audience and name recognition. The black-and-white debate also fails to acknowledge that artists have varying goals: some just want to make a living while others might aspire to being the top selling artist of all time.

The different goals and different models for success reminds me of entrepreneurs and new venture funding models. Bootstrapping, friends and family, angels, venture capitalists and banks all have a role for different entrepreneurs. The entrepreneur who wants to be the next Microsoft or Google requires a different funding path than the entrepreneur who just wants a flexible lifestyle or a family business they can pass to their kids. Trying to find a single "best model" for all entrepreneurs or all musical artists is doomed for failure, it's a spectrum of options that unlocks opportunity for creators and consumers.

Related images: aimee mann, arcade fire, coldplay, david byrne, jane siberry, korn, radiohead, robbie williams, wired

I'm Back on the Grid!!

For those of you wondering why it's been awhile since my last post, blame Alaska. In honor of my in-laws 50th wedding anniversary, our extended family met in Seattle for a group Alaska cruise. Our time there was amazing, relaxing, and very "off the grid".

I'm now digging out of email, voicemails, twitter, friendfeed, facebook etc. backlog. Anyone who left me a message, but doesn't hear back by Monday, please give me another ping. With over 1500 emails waiting, it may take awhile...after clearing that backlog, I hope to share some photos from the trip!

Amazon, Twitter and Operant Conditioning

Twitter/FriendFeed updates announced Amazon.com was down for at least an hour this morning. It has since come up and down a few times. CNet, Mashable, TechCrunch and, thus TechMeme, eventually realized it too. It's up for me now.

I have no idea what happened, but I know Amazon gets a surge of buzz/traffic when it returns. I've seen Twitter leverage this strategy masterfully, reaping the rewards of variable scheduling to maximize conditioned behavior.

Wikipedia's description of operant conditioning has this to say about fixed and variable scheduling of stimulus:

"According to the laws of operant conditioning, any behavior that is consistently rewarded, every single time, will extinguish at a faster rate while intermittently reinforcing behavior leads to more stable rates of behavior that are relatively more resistant to extinction. Thus, in detection dogs, any correct behavior of indicating a "find," must always be rewarded with a tug toy or a ball throw early on for initial acquisition of the behavior. Thereafter, fading procedures, in which the rate of reinforcement is "thinned" (not every response is reinforced) are introduced, switching the dog to an intermittent schedule of reinforcement, which is more resistant to instances of non-reinforcement."

Image above from Reinforcement Schedules (VR line shows maximum impact from Variable ratio schedules)

Applying this to Twitter's intermittent downtime and you can see how Twitter awareness is reinforced every time Twitter comes back from an outage. Services like Twitter need people addicted and, ironically, random outages can help drive the addiction. Hopefully, Amazon's lost sales make it too painful for them to follow a similar approach...

HP's Ultimate Filmmaker Kit & 3Minutes2Launch Contest

My daughter's kicking off a webshow, one nephew is a director and another is a parkour nut with his own blog/videos. I guess that explains why the HP Channelbee.com contest caught my eye over at SocialSpark. One lucky entrant of 3Minutes2Launch who creates a 3 minute video, enters it in the contest and beats out the competition, will win an internship with ChannelBee and produce a documentary of their experience. The next couple videos provide a bit more detail:

I took a look at some of the entries and I have to say this isn't your typical mentos & coke mouth explosion phone-cam contest. This is a chance for someone passionate about directing to show their stuff in 3 minutes, 2 launch a film/TV career. Although I know "real" directors aren't influenced by such material things, HP's Ultimate Filmmaker Kit looks like a great prize all by itself!



Related images: hp 3minutes2launch, channelbee, channelbee, channelbee, parkour