Wednesday, June 7, 2006
The long tail of Netflix
According to this New York Times story on Netflix, which has over 1 billion movie ratings in its system (since it doesn't get rid of the movies you rate even when you leave and then return much later) and some five million households with accounts it is the long tail that's important (just as on eBay, Blogit and many other web services...the idea that there's a small market for every kind of item):
Out of the 60,000 titles in Netflix's inventory, I ask, how many do you think are rented at least once on a typical day?
The most common answers have been around 1,000, which sounds reasonable enough. Americans tend to flock to the same small group of movies, just as they flock to the same candy bars and cars, right?
Well, the actual answer is 35,000 to 40,000. That's right: every day, almost two of every three movies ever put onto DVD are rented by a Netflix customer. "Americans' tastes are really broad," says Reed Hastings, Netflix's chief executive. So, while the studios spend their energy promoting bland blockbusters aimed at everyone, Netflix has been catering to what people really want — and helping to keep Hollywood profitable in the process.