Anderson: —from music not available in Wal-Mart. The typical Wal-Mart store carries about 4,200 albums, which nominally turns into 55,000 total tracks. And if you do the math right, and realize that not all tracks are equally popular, Wal-Mart effectively stocks about 25,000 popular tracks.
Reason: Similar trends are easy to find. In the television market, for instance, people watch more TV than ever before, but there are more TV channels and more TV shows. The supply isn't unlimited, but the typical household gets dozens more channels than it did even 20 years ago. How do the audiences for top-rated shows like Seinfeld or E.R. compare to early ratings champs?
Anderson: Take The Cosby Show. That was the 1980s, and it had an average share of about 35 [meaning 35 percent of households with televisions tuned in]. In the '60s, The Beverly Hillbillies was a 40. Seinfeld was about a 23. I Love Lucy was almost a 70. Today, CSI is around a 10.
Reason: What is driving the Long Tail?
Anderson: It's an economic shift driven by a technological shift. The formula is really easy. When you lower the cost of distribution, you can carry more stuff. You lower the cost of shelf space, you can put more on it. The Internet effectively lowers the cost of distribution and frees up the shelf space.
If you only have room for 10 things on your shelf, you will find that the marketplace as you measure it will choose from among those 10 things. If you have room for 10,000 things, you'll find that those 10 things may still be the most popular 10 things, but they're not 100 percent of the market.
As with water being poured into a bathtub, audiences distribute when given the chance. We've been measuring our culture through the lens of sales and hits. That's what we thought we wanted, but what we find is that limited choice was really what the distribution networks wanted, what the retail channel wanted. It was an artifact of scarcity, an artifact of bottlenecks in the marketplace. We basically had a limited menu, which resulted in limited expressed choice.
Reason: Who knew people wanted computers in any color other than putty when that's all they came in?
Anderson: Exactly.
Reason: Will there be a case where the tail is actually worth more in terms of sales than the head? If so, when and where is that likely to happen?
Anderson: I predict music. You have to be very careful about definitions. If you define the tail as music not available in Wal-Mart, the tail will be larger than the head in the digital music services in less than a decade. For Rhapsody, the trend suggests that it will happen in the next five years.
I should say that the theory of the Long Tail is nowhere predicated on the tail being less than half the market. The point is that the tail is significant in size, that it's a new market and a growing market. What its ultimate size is depends on the specific industry. From industry to industry it'll be different sizes.
Reason: What are the social implications of having an audience that can distribute as widely as the choice available to it?
Anderson: Many people worry about the loss of our common culture, a decline in the water cooler effect, when you can't assume that everyone in your office has seen the same show.
But I think in general that the common culture reflected pretty superficial connections between us. The fact that you and I both watched American Idol last night probably doesn't define us, whereas our niche interests really do. We go deep and find people who share our affinities, which represent much tighter connections between us. So my suspicion is that we're going to have fewer loose connections with lots of people but tighter connections with fewer people.
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