Ten million music tracks remain unsold online

chris

The internet was set to re-shape our music-buying ways - opening up a vast market for sellers and buyers where obscure tracks would drive sales.

However a study has found that more than 10 million of the 13 million tracks available on the internet failed to find a single buyer last year.

This is the first big challenge to Chris Anderson's 'long tail' theory - that niche markets were the key to the future for internet sellers.

Anderson used data from an American online music retailer to predict in his 2006 book, The Long Tail, that the internet economy would shift from a relatively small number of 'hits' - commercial products - at the head of the demand curve toward a 'huge number of niches in the tail'.

This was counter to the '80/20' rule in retailing that suggests the most popular 20 per cent of products is the way to make a profit as they will account for 80 per cent of the sales.

Instead due to cheapness and accessibility of searching for products on online, retailers would be able to make money from more obscure products because they would find an audience.

However a new study by Will Page, chief economist of the MCPS-PRS Alliance, suggests the success of online sales still depends on big hits.

The not-for-profit royalty collection society found that, for the online singles market, 80 per cent of all revenue came from 52,000 tracks.

For albums, the figures were even less encouraging.

Of the 1.23 million available, only 173,000 were ever bought, meaning 85 per cent did not sell a single copy all year, meaning 85 per cent did not sell a single copy all year.

'I think people believed in a fat, fertile long tail because they wanted it to be true,' Page's co-researcher, Andrew Bud, told The Times.

'The statistical theories used to justify that theory were intelligent and plausible.

'But they turned out to be wrong.

'The data tells a quite different story. For the first time, we know what the true demand for digital music looks like, ' added Bud.

'The relative size of the dormant 'zero sellers' tail was truly jaw-dropping,' said Page.

'Rather than continue to believe the selective claims of 'here's another great example of the long tail at work', we wanted to find out how long-tail markets should be analysed, plotted and interpreted,' Page added.

Page and Bud found that online music sales followed a sales distribution laid out by Robert Goodell Brown, an American economist, in 1956.

Brown outlined the theory in Statistical Forecasting For Inventory Control on inventory control that focused on the sales of industrial items such as rivets and widgets.

'There is a an eerie similarity between digital and high-street retailer in terms of what constitutes an efficient inventory and the shape of their respective demand curves,' said Page.

'I think there's something more going on there: a case of new school meets old rules,' he added.



Source:dailymail

Channel Hopper

Anderson postulated a theory, nothing wrong with that. It can be adapted to suit the current climate.

Page is nothing more than an economist, one that puts something in writing only after something gets screwed up (usually spectacularly, and in their own corner of the woods).

Next I suppose we will have a banker or politician telling us it wasn't their fault.

Oh wait !

There is a very fine line between "hobby" and "mental illness"