Hit (or miss) driven businesses

The Freakonomics blog points us to this article on the publishing business. Some choice snippets:

• [on picking hits] The answer is that no one really knows. “It’s an accidental profession, most of the time,” said William... “If you had the key, you’d be very wealthy. Nobody has the key.”
• [On enthusiasts for the medium making up the core of the employees in the segment] "The people who go into it don’t do it for the money, which might explain why it’s such a bad business"
• [on impressions of the business] ...whenever he discusses the industry with people in other industries, “they’re stunned because it’s so unpredictable, because the profit margins are so small, the cycles are so incredibly long, and because of the almost total lack of market research.”
• “The whole thing is educated guesswork, but guesswork nonetheless. You just try to make sure your upside mistakes make up for your downside mistakes.”

The article, of course, is talking about the BOOK publishing business. However, if you were thinking games, it'd still be right on the money.

Nice to know we're not alone.