Disintermediation

Disintermediation is the process of removing intermediaries from the marketing and distribution channels. Many commentators have opined that the growth of electronic commerce will see the disappearance of middlemen as vendors set up websites and sell their products and services directly to the consumer. Others, such as Paul Saffo at the Institute for the Future, believe that it is not necessarily in a company’s best interest to get too close to the customer, and that it is often useful and important to place one or more layers of “cultural brokers” between the vendor and the customer. “The essence is that computers make it easier than ever to be an intermediary. That’s why we will have more intermediaries, not less,” said Saffo. One type of intermediary is a “vortex business.”