Thursday, October 07, 2004

Where is the music industry money made in the future?

Great article about the future of the music industry in the Wired magazine entitled The Long Tail. When you move your music business to the internet and take away packaging, distribution and retail sales, you have a business where the less popular misses of the music industry (the Long Tail) generate more money than all the hits together.

This requires that you are able to construct a business model which allows your readers to navigate from familiar entrant points (hits) to less familiar artists with help of social navigation or something else as easy to use. The reader will notice that his/her taste is actually much different from the mainstream if easy tools for finding more interesting artists are made available.

This is the story backed up with well constructed evidence in various illustrative charts. Way to go. Everyone interested in the music business and everyone who uses P2P networks to download music, should definitely check this out.

Now I just have to find a way to apply this logic to Open Source collaborative software. If the demand is actually in the niche groups, and if it's possible to support all the niche groups, the market of various niche groups is actually bigger than the general mainstream of almost any application. Isn't this what tailoring and customization is all about? Making customization and tailoring affordable so that the niche groups also get served. This is interesting, for example: build value-added services customized and targeted to certain niche groups in the educational world on top of open platforms and open standards.


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