Big numbers & long tail in digital economy

An article in the Economist about the power of big numbers in the world where the niche was supposed to be the king (according to the theory of the long tail, http://www.longtail.com/).

I suggest to read it:
http://www.economist.com/displaystory.cfm?story_id=14959982

It is an old story, something that W. Russell Neuman explained back in 1991 (The Future of Mass Audiences), encouraging to consider the not so-simple rules of new media economy.

New media technology fosters two contradictory drivers of change:
1) one, the power of standardization and big numbers, explained through the economies of scale of media production, and the mass psychology of media use, and
2) one consistent with the fragmentation and customization power of interactivity.

But, as this article and a study published in Harvard Business Review in 2008 (http://hbr.org/2008/07/should-you-invest-in-the-long-tail/ar/1) explain, there are also social and cultural reasons for explaining the enduring importance of big hits, even when new communication technology makes niches more viable, and why "people cluster around popular products".

Though some niche products can be successful, it is more and more difficult to find a business model for the growing numbers of product options available in the digital markets.

Quoting the Economist: "The old-media world of limited choice, in which any product that was not too objectionable was guaranteed a decent audience, was a comfortable place. Pleasing a customer who can choose from several hundred films and television programmes even without getting up from the sofa, by contrast, is an unnerving prospect."

It seems there is no shortcut or simplified route for explaining (and managing in) digital economy, not even in the era of social media. It is a complex world, and it needs to be studied as such.

AM