Background to this blog article

I was heading out to Seattle for a series of partner meetings to review the next version of SharePoint and at the airport I picked up the 2nd edition (2008) of Chris Anderson's book - "The Long Tail" to read on the plane. I had long since intended to see how the theories of the Long Tail might apply to SharePoint ISV's (i.e. product companies) like us at BrightWork and like-minded ISV's like Nintex and K2. We at BrightWork produce a project management plug-in for SharePoint whereas Nintex and K2 are well known for their workflow plug-in and business process plug-in for the SharePoint platform. I have long since felt that we as ISV's need to play an even larger role in the overall SharePoint ecosystem and I was hoping the book might give me some clues as to how. The rest of this article is divided into the following short sections if you want to skip ahead:

• Intent of this article
• What is a 'Long Tail'?
• Music as the example
• The 98% rule is the new 80/20 rule
• What does the SharePoint Solutions 'Long Tail' look like?
• How long is the SharePoint tail?
• SharePoint – do we want a longer tail of solutions?
• How to get a Longer Tail
• Giving SharePoint Solutions a Longer Tail
• Call for Discussion

Intent of this article

Even though I wanted to apply the book to our own company BrightWork and SharePoint ISV's in general, I could not help applying the thinking to the more general case of the SharePoint platform itself and I came to some interesting conclusions that I wanted to bounce off the community to get some feedback! This blog entry is not intended to be a definitive white paper as such. The objective of this blog entry is to give some background material and then share my initial thoughts and most importantly to get community feedback. You should consider this more a conversation opener in intent rather than white paper. You might want to read an extract of the Long Tail book for yourself to get even more background.

What is a 'Long Tail'?

Chris Anderson is the editor in chief of Wired magazine and was the US business editor at The Economist magazine, so he has been observing technology in the US and abroad for a number of years. In the Long Tail blog the following definition / explanation is given:

"The theory of the Long Tail is that our culture and economy is increasingly shifting away from a focus on a relatively small number of hits (mainstream products and markets) at the head of the demand curve and toward a huge number of niches in the tail. As the costs of production and distribution fall, especially online, there is now less need to lump products and consumers into one-size-fits-all containers. In an era without the constraints of physical shelf space and other bottlenecks of distribution, narrowly-target goods and services can be as economically attractive as mainstream fare."

"The term refers specifically to the yellow part of the sales chart above, which shows a standard demand curve that could apply to any industry, from entertainment to hard goods. The red part of the curve is the hits, which have dominated our markets and culture for most of the last century. The yellow part is the non-hits, or niches, which is where the new growth is coming from now and in the future."

Music as the example

According to data in the book, Wal-Mart (America's largest music retailer) carries 4,500 unique CD titles in store but yet only 200 albums (the hits) account for over 90% of the sales. Wal-Mart like all traditional music retailers is selling what we call the "hits". In times past if your music was not designated a "hit" then it would not be sold by the traditional retailers and you'd make no money. Today Rhapsody carries over 4 million unique titles. The amazing thing is that over 900,000 of these are streamed (in other words - sold) every month. So making the wide selection of music available online and accessible has helped make the sales of "traditional-non-hit" a reality where this was not at all possible before. (Of course since the first blog entries on the Long Tail Wal-Mart has an online music catalogue with a Wal-Mart ship to store facility). Bear Sterns (now more famous perhaps for their high-profile part in the recent credit crunch crisis did a nice research piece on the Long Tail and the entertainment industry from which the picture below is cut/paste.

The 98% rule is the new 80/20 rule

We are all pretty familiar with the Pareto principle named after the economist Vilfredo Pareto, who observed that 80% of income went to 20% of the population. We now apply Pareto's 80/20 rule to so many scenarios assuming it to be the rule. However data presented to Chris Anderson (from Robbie Vann-Adibe, the CEO of Ecast) explained that 98% of all albums of the then 10,000 albums in their digital jukebox inventory sold at least one track per quarter. Think about that for a minute - 98% not 20%. The Long Tail book is full of other similar examples from Rhapsody, Apple iTunes, Amazon, etc.. There are a number of factors at play here but in essence with the online models we have today and all the recent digital advances of the past few years, all the small niches can now combine make up a larger aggregate market, especially if it is a digital product that can be shipped electronically.

Proceed to 'part 2 of 3' of this blog article