Lee Gomes manages to pan bloggers, the “tech elite”, Wired and Chris Anderson for all the hype and hoopla around The Long-Tail—the theory laid out in Anderson’s 2006 book of that name that explained “Why the Future of Business Is Selling Less of More.” My favorite line was “The Long Tail seems to have favored the template of many Wired articles: take a partly true, modestly interesting, tech-friendly idea an puff I up to Second Coming proportions.”.

Gomes was inspired to whack the long tail because of a study by HBS marketing prof Anita Elberse that showed that most online sales by dollar volume are in the head and that online retailers ought to think twice if they think the future of business is in the tail. So who’s right on this?

Anderson had an important point. The internet makes the cost of distribution miniscule and therefore creates “infinite aisles” unlike your local WalMart or Virgin Records. With lower costs the tail gets longer thicker. That presents lots of opportunities to sell more online products to niches. And if you have any doubt that you can become rich by catering to the tail just look at the economics of Google. It makes massive amounts of money by catering to small merchants who find its search-based advertising inexpensive and to bloggers and other small publishers who belong to its content network (of course most of its money comes from the head).

The problem of course is in taking this observation and, as Gomes suggests, making sweeping statements about the future of business. And that’s were Elberse comes in. She makes a couple of great observations. First, most of the sales online are still in the head. Any business would be nuts to focus on the tail when lots of demand is in the head. So don’t let the tail wag the dog. Second, people tend to want to consume the same stuff that other consumers consume; there’s a whole host of reasons for that from wanting to chat around the water cooler to the wisdom of the crowds.

Anderson is right that it is cheaper to service the niche online. But businesses have been looking at the tradeoffs between niche and blockbuster strategies for a long time. Consider magazines. There are a number of successful magazine publishers that specialize in niche magazines like Cross-stitcher and Cape Cod Bride. We’re going to see even narrow categories on the web and there will be businesses that cater to small groups; a good example is AdRoll which helps advertisers find really narrow groups. There’s definite market opportunities out there in the tail.

The head, though, will and should remain the focus of attention for most businesses. That’s where, by definition, the preponderance of the value comes from. The tail is important for these businesses but not for the reason Anderson points to. By making it massively cheaper to offer content and by using social networking technology to separate the gold nuggets from the dirt it is far easier for online businesses to find the superstars that will populate the head. My prediction is that the really successful online businesses will use the long-tail to generate hits and do their best to help consumers find the gold. Moreover, people like others to help them do the looking and can be overwhelmed by infinite choice.

The long tail isn’t just hype. But neither is it a simple formula for success. Elberse and Gomes provide an important reality check.