A new breed of intermediary is taking advantage of the economics of information. One of them may already be at work in your market, insinuated between you and your customers.

New entrants such as Industry.Net, IBEX, and Auto-By-Tel are using electronic networks to jump into the value chain in markets from software to industrial goods. The Internet’s World Wide Web, along with the many private networks now emerging, allows these intermediaries to match buyers with sellers and deliver products and services at much lower cost and asset intensity than would be possible within a physical value chain.

Opportunities for buyers, sellers, and new intermediaries to create value in electronic channels are by no means limited to start-ups. Established companies are also moving to capitalize on the economic benefits and marketing reach of e-commerce technologies. Banks are moving to shift their customers to electronic channels - and cross-marketing related financial services such as brokerage and travel along the way. Retailers including Wal-Mart and Kmart have announced on-line sales programs. Some of these shifts are being driven by the entrance of new intermediaries; others are designed to discourage new entrants.

These moves indicate that electronic commerce - defined as the electronic exchange...