Nice post. thanks for sharing.

Those are perhaps the best two sentences on the long tail as applied to small businesses I've read. Exactly…

The benefit accrues not only to large organizations, but to the ecosystems surrounding those organizations. The boundaries separating enterprises from the rest of the ecosystem become more permeable.

When looking at industries, is Young focusing merely on what business models already exist? It seems that smaller companies when they succeed often do so through creative destruction–that is, via business models that suddenly become viable because of new technology. Much of that activity may not be visible in standard industry data because of rigid industry classification schemes. There's so much industry boundary crossing these days that it must be difficult to arrive at a decent dataset to analyze.

At some point we should talk about the promise of the LongTail which has either been horribly misrepresented or horribly misunderstood as the answer to every small business's prayers (the distinction between the two depends on your opinion of Chris Anderson). Personally I am of the belief that the long tail is the answer to Google, Yahoo, Craigslist, and others major companies prayers, but does nothing for the small guy. There is no money operating in the long tail, only money in aggregating it.

“Young believes that as we move deeper into the 2.0 era technology’s benefits to the small will outweigh the ones it offers to the big.”

I'm not sure how you got that impression, but I do not in any way believe that 2.0 technology will primarily benefit the small. In fact my research and advice to clients consistently asserts that the benefits of 2.0 technology have disproportionately accrued to the very large. From all the research (quantitative and qualitative) I have conducted thus far blogs, social networks, wikis, and the rest all improve the ability to manage and orient large, globally distributed organizations far better than they improve the operations of smaller organizations.

In smaller organizations (2-1,000 employees) the proximity to those you work with is much higher, and the odds you will hear about the efforts of those you don't are much greater. There is benefit to be had from 2.0 technology, but it is not nearly as impactful as the same technology applied to the worlds largest businesses. Further still, if we think about the extended community of partners, customers, academics, consultants, etc. for a smaller firm there frankly aren't that many balls to juggle. Scalability is useful, but not ground breaking. For the largest firms that extended network today is enormous and difficult to manage; hence underutilized.

I'm glad to see my point about scale from the last post came through but please don't misunderstand: economies of scale benefit companies of all sizes, however by definition the companies with the largest scale will see the largest economies.

Some of this lies with information that is poorly structured or not readily accessed.

I see a lot of the success with E2.0 based on the assumption that we cannot get lots of the business information structured in a way to deliver useful information. So the E2.0 systems do not impose a structure and let the users develop the structure. They also remove the barriers to access by keeping the platform very open.

In the end, there seems to be recognition that the information is more important than the technology.