I have been enjoying reading the blog of Seth Godin. In a recent post he wrote the following.
It’s quite possible that the era of the professional reviewer is over. No longer can a single individual (except maybe Oprah) make a movie, a restaurant or a book into a hit or a dud.
Not only can an influential blogger sell thousands of books, she can spread an idea that reaches others, influencing not just the reader, but the people who read that person’s blog or tweets. And so it spreads.
The post goes in another direction after that, but I started thinking about this conventional view that the web reduces concentration in the market for professional opinions. No doubt blogs, discussion boards, web 2.0 make it easier for people with opinions to express them and people looking for opinions to find those that suit their taste.
But does this necessarily decrease concentration? If everybody had similar tastes in movies, say, the effect of lowering barriers to entry would be to allow the market to coordinate on the one guy in the world who can best judge movies according to that standard and articulate his opinion. Of course people have different tastes and the conventional view is based on the idea that the web allows segmentation according to taste. But what if talent in evaluating movies means the ability to judge how people with different tastes would react to different movies? A review would be a contingent recommendation like “if you like this kind of movie, this is for you. if you like that kind of movie, then stay away from this one but you might like that one instead.”
In fact, a third effect of the web is to make it easy for experts to find out what different tastes there are out there and how they react to movies. This tends to increase centralization because it creates a natural monopoly in cataloging tastes and matching tastes to recommendations. Indeed, Netflix’s marketing strategy is based on this idea and I am lead to hold out Netflix as a counterexample to the conventional view.