Intermediation definition

Intermediation is the process of creating a new or online middleman. Intermediation can also be a form of "outsourcing," as when a vendor performs a task for a customer that is not a core-competency of that customer.

Online auction sites like eBay are intermediators. For consumers, an intermediator is a new middleman. Before the Internet, consumers had few choices for exchanging information and products. The breadth and depth of the Internet provides consumers with a new, wider marketplace.

For most businesses, intermediation has existed but has been inefficient. The Internet provides a method of providing an efficient market for the exchange of goods and services.