| Friday, August 16th, 2013 | | | | |  | | | The Long Tail, Revisited | | | - Looking to history to see the future: why some household manufacturers could soon turn belly up...
- Why business leaders are most optimistic right before their companies crash and burn: what industries will bite the dust next and how to position yourself ahead of them...
- Plus, Chris Anderson's decade-old gem revisited, the physical limits that have held back retailers and why his predictions are more relevant now than ever...
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| | | | | | | Riddle me this…
What superpower can turn small stock moves into big, BIG profits?
Do you think you have the answer?
| | | | | | | | Peter Coyne, cataloging Makers' Chris Anderson's clairvoyant-like powers of prediction...
 | | Peter Coyne | Watch out, LensCrafters.
A small, startup eyewear manufacturer called Protos Eyewear is using 3-D printing to cut costs while producing eyeglasses specifically tailored to your face. They're using crowdfunding to raise the capital they need.
"We make innovative designs that are impossible to replicate with traditional manufacturing methods," Protos' site claims, "giving you a totally unique frame that is tailored for you." The production process is simple. All you need to do is send two pictures or your face, one from the front and another from the side, while holding a credit card next your mouth for scale. Then you take a quick survey, select the style you'd like and new frames are literally built to fit your face.
"Traditional manufacturing processes have dictated that companies must make thousands of the exact same frames at once," writes Ricardo Bilton at VentureBeat, "regardless of whether those frames are particularly well suited to any one person's face. By using 3-D printing, Protos turns that process on its head, which is why it's worth paying attention to."
Hrmm. The sense of deja vu is overwhelming…
The date was Jan. 19, 2012. Kodak's stock tumbled 18%. It had been choking for air for years... ever since it made a bad bet: film photography would beat digital cameras. Like a captain in front of his crew on a sinking ship, Antonio Perez, CEO, had to get out there and say something. With full knowledge of what was going on, Perez mustered up his last few breaths...
"In a year with significant external head winds affecting a number of industries in which we participate," he said, "I am very encouraged by the performance of our key digital growth businesses..." Exactly one year later, George Eastman's baby would file for Chapter 11.
Rewind two years earlier to 2010. Ben Fritz of the LA Times, pad in hand, sat across from Jim Keyes, CEO of Blockbuster. "Do people still want to drive to a store to rent a DVD?" Fritz asked.
"Absolutely," Keyes forced through his teeth. "Here's an analogy: If I want to buy an obscure book title, I'll go to Amazon.com. But if I want to browse and see what's new, I will go to Barnes & Noble."
He had to have known better... but what else was he going to say? That was on April 2010. Five months later, the video-rental giant would file bankruptcy too. Since then, Blockbuster's closed thousands of retail locations.
We could go on with dozens of Kodak and Blockbuster stories: Tower Records, Borders... heck, even public libraries... you get the gist. We haven't gone back to check each case... but we'd be willing to bet that head of each fallen organization spoke with similar optimism right before they crashed and burned.
The answer why they would go into a fiery tailspin was staring them right in the face... written down in plain English four years before Blockbuster went belly up and six years before Kodak kicked the bucket and seven years before VentureBeat picked up on it.
"'Up until now, the focus has been on dozens of markets of millions, instead of millions of markets of dozens'... This is the world of scarcity. Now, with online distribution and retail, we are entering a world of abundance. And the differences are profound." The author? One of this year's Agora Financial Investment Symposium keynotes, Chris Anderson, writing in his book, The Long Tail (2006).
Going to press today, Aug. 16, 2013, seven years after Anderson published The Long Tail, we'll let the record speak for itself:
Chris Anderson was right.
"Our species turned out to be a lot more diverse than our 20th-century markets reflected." Anderson confirms in his latest book, Makers. "The limited store of selection of our youth reflected the economic demands of retail of the day, not the true range of human taste. We are all different, with different wants and needs, and the Internet now has a place for all of them in the way that physical markets did not."
What's that, you scoff? "Great, let me get out my time machine to go invest in the Internet..."
The Internet? That's just digital stuff... pictures, video and words on your computer screen... not stuff you can hold in your hands. We're talking about the Maker movement, you know, 3-D printing.
"The Maker movement," Anderson told the assembled in Vancouver, "is basically the Web generation meets the real world."
Here's the rub. The Pandora's box of niche demand that Anderson said had been opened back in 2006 is peanuts next to the wave of innovation and investment opportunities that stand before you. At stake is your share of a rapidly growing $8.4 billion industry. Just like the Blockbusters, Kodaks and Tower Records of the world, this technology will eliminate entire industries (knowing which is the key) while giving rise to a new quantity of entrepreneurs never seen before in history…
In fact, by our estimates, those quick enough to see the opportunity standing before them stand to make up to $84,000 (or more). If you don't believe us, simply click here.
If you're still not sold on the sheer profit potential of the 3-D printing revolution, you owe it to yourself to check the historical record. In today's episode of The Daily Reckoning, we travel a decade back in time to revisit Chris Anderson's original essay "The Long Tail," which he penned as editor of Wired magazine. He hit the nail right on the head with clairvoyant-like accuracy.
Read on below...
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| | | | The Long Tail, Revisited | | | | by Chris Anderson | | | In 1988, a British mountain climber named Joe Simpson wrote a book called Touching the Void, a harrowing account of near death in the Peruvian Andes. It got good reviews but, only a modest success, it was soon forgotten. Then, a decade later, a strange thing happened. Jon Krakauer wrote Into Thin Air, another book about a mountain-climbing tragedy, which became a publishing sensation. Suddenly Touching the Void started to sell again.
Random House rushed out a new edition to keep up with demand. Booksellers began to promote it next to their Into Thin Air displays, and sales rose further. A revised paperback edition, which came out in January [2004], spent 14 weeks on the New York Times bestseller list. That same month, IFC Films released a docudrama of the story to critical acclaim. Now Touching the Void outsells Into Thin Air more than two to one.
What happened? In short, Amazon.com recommendations. The online bookseller's software noted patterns in buying behavior and suggested that readers who liked Into Thin Air would also like Touching the Void. People took the suggestion, agreed wholeheartedly, wrote rhapsodic reviews. More sales, more algorithm-fueled recommendations, and the positive feedback loop kicked in.
Particularly notable is that when Krakauer's book hit shelves, Simpson's was nearly out of print. A few years ago, readers of Krakauer would never even have learned about Simpson's book -- and if they had, they wouldn't have been able to find it. Amazon changed that. It created the Touching the Void phenomenon by combining infinite shelf space with real-time information about buying trends and public opinion. The result: rising demand for an obscure book.
This is not just a virtue of online booksellers; it is an example of an entirely new economic model for the media and entertainment industries, one that is just beginning to show its power. Unlimited selection is revealing truths about what consumers want and how they want to get it in service after service, from DVDs at Netflix to music videos on Yahoo! Launch to songs in the iTunes Music Store and Rhapsody. People are going deep into the catalog, down the long, long list of available titles, far past what's available at Blockbuster Video, Tower Records, and Barnes & Noble. And the more they find, the more they like. As they wander further from the beaten path, they discover their taste is not as mainstream as they thought (or as they had been led to believe by marketing, a lack of alternatives, and a hit-driven culture).
An analysis of the sales data and trends from these services and others like them shows that the emerging digital entertainment economy is going to be radically different from today's mass market. If the 20th- century entertainment industry was about hits, the 21st will be equally about misses.
| | | | | | | If You Own A Firearm, You Must See This
If you own a gun, have ever applied for a firearm license, or are thinking about purchasing a weapon… | | | | | |
For too long we've been suffering the tyranny of lowest-common-denominator fare, subjected to brain-dead summer blockbusters and manufactured pop. Why? Economics. Many of our assumptions about popular taste are actually artifacts of poor supply-and-demand matching -- a market response to inefficient distribution.
The main problem, if that's the word, is that we live in the physical world and, until recently, most of our entertainment media did, too. But that world puts two dramatic limitations on our entertainment.
The first is the need to find local audiences. An average movie theater will not show a film unless it can attract at least 1,500 people over a two-week run; that's essentially the rent for a screen. An average record store needs to sell at least two copies of a CD per year to make it worth carrying; that's the rent for a half inch of shelf space. And so on for DVD rental shops, videogame stores, booksellers, and newsstands.
In each case, retailers will carry only content that can generate sufficient demand to earn its keep. But each can pull only from a limited local population -- perhaps a 10-mile radius for a typical movie theater, less than that for music and bookstores, and even less (just a mile or two) for video rental shops. It's not enough for a great documentary to have a potential national audience of half a million; what matters is how many it has in the northern part of Rockville, Maryland, and among the mall shoppers of Walnut Creek, California.
There is plenty of great entertainment with potentially large, even rapturous, national audiences that cannot clear that bar. For instance, The Triplets of Belleville, a critically acclaimed film that was nominated for the best animated feature Oscar [in 2004], opened on just six screens nationwide. An even more striking example is the plight of Bollywood in America. Each year, India's film industry puts out more than 800 feature films. There are an estimated 1.7 million Indians in the US. Yet the top-rated (according to Amazon's Internet Movie Database) Hindi-language film, Lagaan: Once Upon a Time in India, opened on just two screens, and it was one of only a handful of Indian films to get any US distribution at all. In the tyranny of physical space, an audience too thinly spread is the same as no audience at all.
The other constraint of the physical world is physics itself. The radio spectrum can carry only so many stations, and a coaxial cable so many TV channels. And, of course, there are only 24 hours a day of programming. The curse of broadcast technologies is that they are profligate users of limited resources. The result is yet another instance of having to aggregate large audiences in one geographic area -- another high bar, above which only a fraction of potential content rises.
The past century of entertainment has offered an easy solution to these constraints. Hits fill theaters, fly off shelves, and keep listeners and viewers from touching their dials and remotes. Nothing wrong with that; indeed, sociologists will tell you that hits are hardwired into human psychology, the combinatorial effect of conformity and word of mouth. And to be sure, a healthy share of hits earn their place: Great songs, movies, and books attract big, broad audiences.
But most of us want more than just hits. Everyone's taste departs from the mainstream somewhere, and the more we explore alternatives, the more we're drawn to them. Unfortunately, in recent decades such alternatives have been pushed to the fringes by pumped-up marketing vehicles built to order by industries that desperately need them.
Hit-driven economics is a creation of an age without enough room to carry everything for everybody. Not enough shelf space for all the CDs, DVDs, and games produced. Not enough screens to show all the available movies. Not enough channels to broadcast all the TV programs, not enough radio waves to play all the music created, and not enough hours in the day to squeeze everything out through either of those sets of slots.
This is the world of scarcity. Now, with online distribution and retail, we are entering a world of abundance. And the differences are profound.
Regards,
Chris Anderson
for The Daily Reckoning
Ed. Note: Mr. Anderson left his post as editor-in-chief of Wired magazine in 2012. He was so convinced in the new industrial revolution and do-it-yourself movement that he started an entirely new company called 3D Robotics. What he saw was an $8.4 billion pie that he wanted to get a slice of. Now you can too, without starting your own robotics company -- simply watch our brand-new video, Click. Print. Revolution.
| | | | | | |  Chris Anderson is an American author and entrepreneur known for his 2004 article entitled The Long Tail. His most recent book, Makers: The New Industrial Revolution, is now available from Laissez-Faire Books. He is currently the cofounder and CEO of 3DRobotics, a drone manufacturing company. | | | | | | | | | BE SURE TO ADD dr@dailyreckoning.com to your address book.
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