YOUNG ENTREPRENEUR0:

The Long Tail .... No, it's got nothing to do with dogs, monkeys or elephants - it's actually a way of describing the business models of many online companies such as Amazon, Netflix and iTunes. The phrase was coined in 2004 by Chris Anderson, the editor in chief of Wired Magazine, an American technology magazine. Anderson observed that the majority of Amazon's sales didn't actually come from the most popular books that were sold, but rather from the ones that were considered least popular. The top twenty percent of sales, while the most popular, were actually eclipsed by the bottom eighty percent, the so called Long Tail. Amazon's business model, storing stock in warehouses rather than in a traditional shop, allow it to stock many books that only a small number of people are interested in.

The Long Tail ... No, it's got nothing to do with dogs, monkeys or elephants - it's actually a way of describing the business models of many online companies such as Amazon, Netflix and iTunes. The phrase was coined in 2004 by Chris Anderson, the editor in chief of Wired Magazine, an American technology magazine. Anderson observed that the majority of Amazon's sales didn't actually come from the most popular books that were sold, but rather from the ones that were considered least popular. The top twenty percent of sales, while the most popular, were actually eclipsed by the bottom eighty percent, the so called Long Tail. Amazon's business model, storing stock in warehouses rather than in a traditional shop, allow it to stock many books that only a small number of people are interested in.
YOUNG ENTREPRENEUR1:

But the sheer volume of these niche books made available to purchase allowed Amazon to sell them in greater volume than the current best sellers. This idea has had a profound impact on how people see ecommerce. Businesses are able to offer products that they know are not very popular as long as the storage and distribution costs are low. Customers have a higher chance of finding products that interest them due to the much bigger choice available to them. They are also more likely to be prepared to pay more for a product that they value highly.

But the sheer volume of these niche books made available to purchase allowed Amazon to sell them in greater volume than the current best sellers. This idea has had a profound impact on how people see ecommerce. Businesses are able to offer products that they know are not very popular as long as the storage and distribution costs are low. Customers have a higher chance of finding products that interest them due to the much bigger choice available to them. They are also more likely to be prepared to pay more for a product that they value highly.
YOUNG ENTREPRENEUR2:

The net result of this is that we are in the middle of a huge change in the way we experience culture and content. Whereas previously consumers were forced to accept the most popular TV shows, books and movies; the products that companies knew would sell in large enough quantities to cover their costs, now we are free to enjoy what we want, how we want it. Let's take TV as an example. Traditional TV stations broadcast their most popular shows in prime time slots when they can be sure that the majority of viewers will tune in. These are very important for the stations as the advertising fees they can charge are much higher than at other times.

The net result of this is that we are in the middle of a huge change in the way we experience culture and content. Whereas previously consumers were forced to accept the most popular TV shows, books and movies; the products that companies knew would sell in large enough quantities to cover their costs, now we are free to enjoy what we want, how we want it. Let's take TV as an example. Traditional TV stations broadcast their most popular shows in prime time slots when they can be sure that the majority of viewers will tune in. These are very important for the stations as the advertising fees they can charge are much higher than at other times.
YOUNG ENTREPRENEUR3:

As a result the shows broadcast tend to be the most mainstream - shows with broad appeal, but not necessarily the most interesting ones. Cable TV and the Internet have changed all that. The Long Tail allows broadcasters to show a higher volume of less popular shows in the knowledge that overall, they will be as popular and profitable as the old prime time system. For businesses that understand this the possibilities are great, diversification of the products they offer allow them to spread their profits over a much larger area and there is less reliance on the success of a relatively small number of shows. For the consumers the benefits are great.

As a result the shows broadcast tend to be the most mainstream - shows with broad appeal, but not necessarily the most interesting ones. Cable TV and the Internet have changed all that. The Long Tail allows broadcasters to show a higher volume of less popular shows in the knowledge that overall, they will be as popular and profitable as the old prime time system. For businesses that understand this the possibilities are great, diversification of the products they offer allow them to spread their profits over a much larger area and there is less reliance on the success of a relatively small number of shows. For the consumers the benefits are great.
YOUNG ENTREPRENEUR4:

We are no longer tied to the restrictive TV schedules of the past. We can choose whatever we want to watch, and certainly with streaming Internet video or download services, we are able to choose when we want to watch these shows. The effect of this on our culture as a whole is a greater freedom of expression, more chances for smaller producers to get their work to the public and more choices for the consumer. And all of this is possible while making a great profit at the same time!

We are no longer tied to the restrictive TV schedules of the past. We can choose whatever we want to watch, and certainly with streaming Internet video or download services, we are able to choose when we want to watch these shows. The effect of this on our culture as a whole is a greater freedom of expression, more chances for smaller producers to get their work to the public and more choices for the consumer. And all of this is possible while making a great profit at the same time!