In this video, Professor Larru discusses the impact of digital distribution on supply and demand across various sectors. He explains the Pareto distribution, also known as the 80/20 rule, which is prevalent in entertainment, real estate, and grocery distribution. Professor Larru highlights that traditional markets are limited by physical space, leading to a focus on high-demand products. However, in the digital marketplace, businesses can thrive by adopting the long-tail strategy, offering a wide range of niche products.