EconTalk Chris Anderson and the Long Tail
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Aug 7, 2006 
Chris Anderson, author of The Long Tail, discusses the weird world of internet distribution, the economics of choice and the role of filters, and the challenges of wrapping our minds around emergent phenomena. He explores the concept of the long tail in digital marketplaces and the power of niche content. They also delve into the limitations imposed by scarcity and the expansion of consumer choice. The conversation highlights the paradox of choice, the power of relevance, and the diffusion of power in mainstream media and the blogosphere. They also touch on the influence of the internet on politics and the lack of diversity in the political landscape.
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Small Sales Add Up In Digital Markets
- Digital marketplaces reveal demand for many low-volume items that brick-and-mortar stores never stocked.
- Aggregating those niches adds up to a substantial market that changes business economics.
Markets Follow A Power-Law Curve
- Product popularity follows a power-law: a steep head and a long, low tail of niche items.
- With near-zero marginal distribution cost you can offer the whole curve instead of cutting off the tail.
Geography No Longer Limits Niches
- Distributed demand means niche audiences exist across geography, not concentrated locally.
- Internet marketplaces aggregate this dispersed interest and unlock previously uneconomical markets.