Disintermediation and the Internet
You can hardly pick up a newspaper or magazine without reading a glowing account of the information superhighway and its new features, capabilities, and benefits. Exciting computer services will be available, children will be smarter, democracy will flourish, and everyone will be richer and better connected. Hidden away in these articles-or ignored altogether-are significant and less positive changes in existing institutions that are also resulting from the information superhighway. Change is by no means a bad thing, although your view may be different if you are likely to lose your job, an old familiar service, or control over your children’s activities. Regardless, change is inevitable, and it is not my purpose here to throw rocks at the information superhighway. Instead, I offer a way of looking at the Internet (a convenient proxy for whatever form the computer network ultimately takes) and some of the changes that it is producing. The theme is that the Internet is a mechanism for disintermediation. This concept does not explain everything that is happening, but it will help to identify why some existing institutions will fail as a result and why some individuals are so uncomfortable with the new technology.