Eliminating Atoms

The ultimate cost reduction is eliminating atoms entirely and dealing only in bits. Pure digital aggregators store their inventory on hard drives and deliver it via broadband pipes. The marginal cost of manufacturing, shelving, and distribution is close to zero, and royalties are paid only when the goods are sold. It’s the ultimate on-demand market: Because the goods are digital, they can be cloned and delivered as many times as needed, from zero to billions. A best-seller and a never-seller are just two entries in a database; equal in the eyes of technology and the economics of storage.

Chris Anderson, The Long Tail, 2006