Long Tail Epiphany Pt 1: The Death of Distribution

I've been delving deeper into the concept of the Long Tail - which is proving to offer me multiple epiphany moments.  Anyone working in the music industry that hasn't read it should - in fact, I have a feeling most major label suits have read it - and it scares them shitless.

One of the laws of the Tail is to "Democratize Distribution". In the digital world of infinite choice, the old rule of the industry does not apply - physical distribution is no longer the key to reaching your audience.

When Gaymonkey launched we worked hard to find a distributor. We were rejected by many of them because we didn't have the sound they were looking for (which puzzled me greatly - what did a distributor know about what music people wanted to listen to - surely there is an audience for everything?). But when Silence started to get a lot of attention, the distributors came to us.

We thought we had it made - the door was unlocked - finally people could get our music. And at the same time we had made some strong decisions around our digital presence. Things were great.

But soon I realised it wasn't going to be so rosy. Distributors don't just sell your music - they control it to maximise their profit potential. To sell more units, they strive to push your catalogue into "the curve" - the mass market space everyone has traditionally battled to be in. Selling a few units a week to stores is too time consuming to them - they need you to have a hit, or you aren't worth their time. 

So in true freakenomics fashion, they force albums into big retailers hands (HMV, Virgin, Fopp, Play.com) - the distributor makes money on initial units shipped - even if it is returned, they still keep their cut, while the labels are forced to foot the bill. The label loses out, and so does the artist.

It was suggested by our distributor that we were "too niche". They worked hard to get all their albums into the curve, and we needed to be there too. Last year they went bankrupt.  So did Fopp. Virgin has gotten out of its music retail division, and HMV has significantly trimmed down its inventory to focus on games and compilation CDs that they can flog at high volume over xmas. Maybe the curve isn't so great after all. 

In our new world of democratized distribution, the label and artist controls the release schedule. We still work closely with our digital distributor to plan our releases, but there is no pressure to modify our catalogue or promote within the curve. Because in the Long Tail niche is respected - and in the end the listener has the infinite choice.

Image by noseacuerdan on Flickr

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