A Mass of Niches

I wrote this phrase down about twenty years ago as the title for something I never got around to writing. I've kept coming back to it since, mostly because the thing it describes has become more true rather than less. So it may as well be the name.

The idea is simple. The mass audience did not disappear. It subdivided. And almost every structure the music business built to serve a single mass audience is now working against the shape of what replaced it.

The mass audience was a manufactured condition

It's easy to talk about the mass market as though it were a natural state that has since decayed. It wasn't. It was an artifact of scarce distribution.

There were a limited number of radio stations, a limited number of television channels, a limited amount of retail shelf, and a small number of people deciding what went on all of it. Scarcity like that manufactures a common culture. If forty million people are choosing from the same twelve options, they will converge, and the convergence looks like consensus. It was never consensus. It was a bottleneck.

When distribution went effectively infinite, the condition that produced mass audiences dissolved. Not the audience — the condition. The same number of people are still listening to music, going to shows, and spending money on artists they care about. There is simply no longer a mechanism forcing them all through the same twelve doors.

What's left is a very large number of smaller audiences. Hence the name. The mass is still there in aggregate. It just isn't one thing anymore.

This is not the long tail

The obvious comparison, and worth dealing with directly, because they are not the same argument and the difference is the whole point.

The long tail was a retailer's thesis. Infinite shelf space means you can profitably stock the obscure, and the money is in selling a small quantity of an enormous number of things. It described the world accurately and it made a great deal of money — for the aggregators. It is the logic of the catalogue, the platform, the marketplace. It is fundamentally an argument about the position of the intermediary.

Mass of Niches is the same phenomenon viewed from inside one of the niches, which is where artists actually live.

From that vantage point the arithmetic looks completely different. The niche is not small. It is an entire audience. It has geography, purchase history, thirty years of accumulated relationship, and a willingness to spend that has nothing to do with how many other people share the enthusiasm. An artist with forty thousand engaged buyers is not sitting in the tail of anyone's distribution. They are running a business, and for them, that forty thousand is the mass.

The long tail asks how a platform profits from many niches. This asks what a niche is worth to the person at the centre of it. Those questions have almost nothing to do with one another.

Fragmentation concentrated attention rather than diluting it

The pessimistic reading of all this is that everyone now has a smaller slice. That misreads what happened.

When there is no dominant culture competing for someone's attention, the attention they do give goes considerably deeper. A person inside a niche is not a casual consumer. They buy the deluxe edition, travel to the show two provinces over, own the back catalogue on two formats, and have been at it for two decades. Nobody is famous to everyone anymore. But a great many artists are enormously important to some people, and being enormously important to some people is a far better commercial position than being vaguely known to everyone.

Value per person went up as reach went down. Most of the industry is still measuring the wrong one.

The mismatch

Here is where it stops being an observation and starts being a business problem.

The machinery of the music business is volume machinery. It was engineered to identify the broadest common denominator and serve it with one product, at one price, through one channel, at scale. Mass marketing, mass retail, mass ticketing — all of it optimised for throughput, all of it built on the assumption that the audience is one large undifferentiated block.

That machinery is not evil. It is mismatched. It is a tool built for a shape that no longer exists, and it performs badly against forty thousand people who want something specific. It cannot price differently for them, cannot sequence access for them, cannot carry a product with a two-thousand-unit ceiling, and has no economic reason to learn who they are.

So it doesn't. And the artist, who does have every reason to know exactly who those people are, ends up renting access to their own audience from an intermediary that is structurally incapable of serving it properly.

The whole of my working life has been spent on the other side of that — building the direct version, artist by artist, and finding out what it actually costs and returns.

The middle is where the business is

One last piece, because it's the part people find counterintuitive.

The attention goes to the extremes. Stadium acts at one end, bedroom artists at the other. Both are interesting and neither is where the durable money is.

The durable money is in the middle — artists who sell somewhere between two and eight thousand seats a night and have done so for thirty years. They have a real audience, real catalogue, real purchase history, and no realistic expectation of a hit changing their circumstances. Nobody builds for them, because they are unglamorous and they don't produce the kind of numbers that make anyone's quarter. They are also, almost uniformly, excellent businesses.

That is the population this is written for and about.

What this will be

Structural economics and operating detail from inside the direct-to-fan business. What it costs, what it returns, what breaks, and what the people running it have learned the expensive way. Every couple of weeks, roughly.

The audience didn't get smaller. It got specific. Most of the industry hasn't adjusted, and the ones who have are quietly doing very well.

I run the online division for established touring artists — artist.com, presales, VIP, fan clubs, and global direct-to-fan retail with in-house fulfilment. The online business should support the offline business, not sit beside it.