The premise of home-grown media is that the public wants content outside the mass taste. That premise was affirmed in an October 2004 article by Wired magazine editor Chris Anderson. Entitled The Long Tail, it suggests that web-based distribution systems like Amazon.com are selling lesser-known works that retail outlets, with limited shelf space, haven’t previously been able to carry or promote them.
Anderson explains how Amazon’s recommendation engine — people who like this book also liked whatever — made Touching the Void a new mountain-survival hit, by linking it to the coattails of the more heavily promoted Into Thin Air.
He dwells on the economics of music distribution — Wal-Mart can only sell 1 percent of CDs, because it carries only those with a certain sales threshold. Even online distribution is overpriced at 99 cents a cut, he says, because the real cost of digital delivery, including current profit levels to the creative folks, is about 79 cents. Online jukebox Rhapsody sold three times as many tunes at 49 cents than it did at 99 cents (but lost money on each sale because it paid 73 cents per cut by his figures!).
Anderson uses that experiment to suggest that publishers of all stripes dramatically cut prices on their backlist — titles they own but no longer promote — and use the web to find the price point where the niche content finds its audience.
Tomorrow, I’ll take the niche content idea to the next level, and ask whether we can create a peer-to-peer entertainment system. People once entertained each other. They didn’t outsource amusement. Anderson touches on this concept, citing the example of MP3.com, an online distribution label that tried to let bands bypass the record labels and got a reputation for peddling “an undifferentiated mass of mostly bad music.” Goodnoise made a similar effort.
But I want to leave you with a number from the Pew Internet survey which found that 10 million Americans “earn at least some money from their performances, songs, paintings. videos, sculptures, photos or creative writing.” To me that suggests a viable market of some sort. Stay tuned.
Tom Abate
January 5, 2005