Understanding Disintermediation: How Technology Eliminates Intermediaries

Disintermediation is a process where a technology or platform eliminates intermediaries in a supply chain, allowing for more direct interaction between buyers and sellers. This can lead to cost savings, increased efficiency, and greater transparency.
For example, online travel agencies like Expedia and Airbnb have disintermediated traditional travel agents and hotel chains, allowing consumers to book flights and accommodations directly with the suppliers. Similarly, online marketplaces like Amazon and eBay have disintermediated traditional retailers, allowing consumers to purchase products directly from third-party sellers.
Disintermediation can also occur in financial services, such as peer-to-peer lending platforms that eliminate the need for banks and other intermediaries. In the media industry, streaming services like Netflix and Hulu have disintermediated traditional television networks and movie studios, allowing consumers to access content directly online.
The impact of disintermediation on businesses and industries can be significant, as it often leads to a shift in power dynamics and the way that value is created and captured. It can also lead to new opportunities for innovation and growth, as well as challenges for companies that are unable to adapt to the changing landscape.