An academic research paper thinks it might be. Researchers at Wharton used data from Netflix (which was made available in order to create a better recommendation system) to question Chris Anderson's theory:

The Wharton researchers find that the Long Tail effect holds true in some cases, but when factoring in expanding product variety and consumer demand, mass appeal products retain their importance. The researchers argue that new movies appear so fast that consumers do not have time to discover them, and that niche movies are not any more well-liked than hits.

What I think is this: where you have a good recommendation system that will surface previously unknown products (and especially where those products are available in digital form), the Long Tail holds up. Take music, with Pandora (based on the music genome project). I've discovered a bunch of artists that I wouldn't have otherwise known about. However, the underlying genome project had to exist first, and the product had to exist in a fashion that didn't cost Apple (and Amazon) extra money to stock. The incremental cost of making an additional mp3 file available is close to zero; the cost of stocking, say, an additional variety of mustard isn't.

Where the long tail will really come into play is in spaces like music - where there's no (or virtually no) stocking cost, and where a recommendation system makes a real difference. So far, that's happening in music. I think it's possible it could happen in film/tv and I think you could argue that the rise of open source software is an instance of the effect, too.

Physical products though? The only one that really comes to mind is books, because of Amazon's recommendation system. Even there though, Amazon has been trying to get the Kindle to catch on - in part, I think, to lower their stocking costs. It's cheaper to just pay for the rights to a book when it sells than it is to pay for both the rights and the shelf space.

That's why I suspect that "Long Tail" action won't have much impact on physical retailers. First, there's cost; second, there's the whole "Paradox of Choice" problem. Having like products recommended to me on Amazon is one thing; being confronted with 100 physical options is another. Online, I'll page through the "people who bought X also bought Y"; in a store, those same choices, laid out in front of me, tend to paralyze.

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