disintermediation

thumb|The disintermediation process thumb|Intermediary B may be bypassed by A to connect with C directly. thumb|Although Webvan failed in its goal of disintermediating the [[North American supermarket industry, several supermarket chains (like Safeway Inc.) have launched their own delivery services to target the niche market to which Webvan catered.]] Disintermediation is the removal of intermediaries in economics from a supply chain, or "cutting out the middlemen" in connection with a transaction or a series of transactions. Instead of going through traditional distribution channels, which had some type of intermediary (such as a distributor, wholesaler, broker, or agent), companies deal with customers directly and vice versa, for example via the Internet.

==History== In 1967, the term was originally applied to the banking industry; disintermediation occurred when consumers avoided the intermediation of banks by investing directly in securities (government and private bonds, insurance companies, hedge funds, mutual funds and stocks) rather than leaving their money in savings accounts. The original cause was a U.S. government regulation (Regulation Q) which limited the interest rate paid on interest bearing accounts which were insured by the Federal Deposit Insurance Corporation.