Interactive multimedia is contagious. The trajectory and timing of its development will transform not only technology providers, but an increasingly broad range of other industries as well, including retailing, advertising, and financial services. The key agents of this transformation will be so-called "gateway businesses"—the suppliers, like CompuServe or Prodigy or America Online, of navigation assistance to end users seeking to locate resources available through the electronic network.

Although standalone gateways today are largely limited to computers, they will soon be widely available on other platforms such as TVs, set-top boxes, portable access devices, and even screen-based telephones. At present, these gateways represent a fairly small revenue stream—less than US$800 million in 1994. Most of that revenue is concentrated in the United States, with a few notable exceptions such as the Minitel network in France. Nonetheless, the choices that the managers of these businesses make today will deeply enhance—or erode—the opportunities that managers of other businesses will have to create value in the future.

Today a gateway is often tightly bundled with another business. The dial tone you hear when you pick up a phone and the number you enter on a telephone key pad represent elements of a simple...