This week’s Networked Media Symposium helped me to gain a deeper understanding of last week’s readings on the 80/20 rule and ‘the long tail’. Prior to this discussion, I don’t think I completely understood how the 80/20 rule was linked to power law distributions. Adrian used the graph below with the example of the film industry, saying that if the ‘head’ was all of the cinema ‘hits’, which are roughly 20% of all films made, but make 80% of all the money in the industry; then the ‘long tail’ is the other 80% of all films made, otherwise known as the ‘misses’, which only bring in 20% of the overall market revenue.
Adrian also told us that ‘the most expensive thing in retail is shelf space’. Thus, it would only make sense for video rental stores to stock the most popular movies – the 20% that makes the 80% of the market’s income. However, ‘shelf space’ or even the idea of space in general, isn’t a limitation online (unless we’re talking hard-drive space). For example, it doesn’t cost iTunes any more money to ‘stock’ a Lady Gaga track as it does some obscure band’s psychedelic-indie-rock-hindu-dubstep-minimal track. It is for this reason that niche markets have flourished online and is essentially why ‘traditional media’ like newspapers, DVDs and CDs are dying out (have a look at the article Adrian posted about Music Streaming Revenues Overtaking CD Sales In The U.S.)