Classical Music and the Long Tail

Classical Music and business have never been a harmonious duo.
That classical music is an acquired taste means that its customers are in for a very long sales cycle - the prospect must be cultivated at a young age long before he can afford the $16 for a CD let alone the $75 for a live performance.
Then, after you've acquired these customers, the operating costs are immense. First, your business is labor intensive - to bring a performance of Strauss to life you need 90 highly trained, highly compensated professionals. Second, your capital costs are significant - imagine building and maintaining a Severance Hall not to mention the Steinways and the timpani.
Forget about automation. Synthesizing the extra brass parts in Bruckner to reduce costs? Absurd. You need people. Many, well compensated, people who need pensions and health insurance. And Economies of scale don't exist either in live performance. Shea Stadium is for the Rolling Stones not the New York Philharmonic.
The only possibility for scale is to record. You invest the money in producing CDs with the hopes of selling enough to break even. But you'd better not be too adventurous. Stick to the Three B's and maybe through in an M.
But that was before the internet age and a phenomenon author Chris Anderson calls The Long Tail.
According to Anderson, technology advances such as the internet and digitization have caused a democratization of production, distribution and marketing of goods. So a shift has occurred from large, well-funded, market-dominating players pushing a handful of blockbuster hits on the mass market to a near infinite variety of niche players who exploit ever cheaper technology and an internet-based word-of-mouth network to cater to every imaginable preference.
According to a recent Boston Globe article this democratization enables arts organizations to scale and market in ways new and unforeseen even 5 yrs ago. Take for example the Boston Symphony/Boston Pops that's spending only $100,000 per episode to produce free online performance complete with backstage interviews.
Consider the Chicago Symphony who have started their own record label that offers free samples on iTunes. Or the Isabella Stewart Gardner Museum whose chamber music podcasts from this sumptuous neo-Renaissance palace in Boston are in the iTunes Top 40!
My favorite example of all: the Boston Pops is using YouTube.com, a Web 2.0 poster-child if ever there was one, to allow contestants to audition for a guest-star spot in the orchestra's nationally televised Fourth of July concert.
The interesting thing is this - here, the Long Tail is not generating a following for a garage band or an indie film maker but helping to sustain some of the largest and most elite cultural organizations in the world. Many of these institutions are cultural icons that, shame on us, live hand-to-mouth or run deficits that must be made up through corporate or individual hand-outs.
Two Hundred Years ago the "business model" for art music - the patronage system - changed radically along with the European economic and social order. And so it may again.