Back in the glimmering dawn of the dot-com era, a term that got lots of mileage for those of us in the high tech writing game was "disintermediation." This simply meant applying Internet technology to cut middlemen out of a transaction, with the goal of either making it cheaper for the buyer, more profitable for the seller, or both. People were going to buy their insurance, cars, home mortgages, you name it, online, in the process saving money that might otherwise have gone to insurance agents, car salesmen, mortgage brokers, etc. And while it has lately been popular to tear down the Internet phenomenon that we just spent two years building up, disintermediation has worked pretty well. If you are willing to do the Web work required, it is possible to save substantial amounts of money using these services.

Lately, as dot-coms run out of money and fold by the hundreds (their founders generally taking with them only a VHS copy of that clever commercial they ran during the third quarter of the last Super Bowl), it is easy to think that the process of disintermediation is coming to an end. But that just isn't so. What might be ending is the era of silly disintermediation — cutting out nonexistent or necessary middlemen, or eliminating middlemen at the cost of building superfluous extra layers.

This latter effect is present for most Internet grocers, for example. While Webvan eliminates the need for a supermarket, it creates the need for a warehouse and distribution system. A better approach to online grocery buying, then, might be to build it as an ordering and delivery service atop a warehouse that already exists and is paid for. That's how Tesco, the big UK supermarket chain, does it, with pickers grabbing steaks from the same fridge and the same store you would go to if you weren't at work trying to finish that report. Tesco makes a profit from selling food over the Internet. Webvan doesn't.

But the really big disintermediation opportunities are still in areas where the deliverable comes in the form of electrons, rather than canned beans. Money is a great thing to schlep over the Net, as are products or services bought with money that are relationships or rights, rather than tangible goods. Insurance and mortgages are perfect. The more complex the product mix, the better for disintermediation — that is, if the disintermediator does a good job of helping the buyer through the maze of competing opportunities toward a good deal. This is where Web site and back-end database design are everything. Anyone who has compared and contrasted airline Web sites can see this effect in action. Isn't it amazing how much easier some airline sites are than others? Yet most of them seem to be running as applications on the same Internet Travel Network database. Given they are hitting on the same database, why don't these sites offer comparable service? Beats me.

Another great disintermediation area is advice. You can never have enough good advice, eh? Or maybe you believe, as did Jung, that "good advice is a doubtful remedy, but of little danger since it is so rarely followed." So far on the Web, most advice has come either in the form of formalized reviews a la traditional IT publishers, Consumer Reports, or folks like Gomez.com, or it has come in the form of peer reviews on community-based sites. The Motley Fool probably originated this very successful ploy of helping people help each other, and making a couple bucks from banner ads and selling related services at the same time. But very little advice available on the Web is customized or immediate. That's where you still needed to hire a real expert. Until now.

Financial Engines is a Palo Alto, California-based company that gives its members access to the same kind of stock portfolio management tools used by big institutional investors. Since it went live in 1998, Financial Engines has primarily offered portfolio analysis tools to individuals to help them maximize the returns on their tax-deferred retirement investment accounts like 401-Ks and Keogh plans. Tell the system your investment aims, your holdings, and the securities available to choose from in the retirement plan, and Financial Engines would help you choose the mix of holdings most likely to get you where you want to go. And if your goals or the market changed, it was a simple matter to rerun the analysis or send you a notice that a better opportunity had come available. And it works fine, especially given the built-in limitations of the system. That is, it has been limited to tax-deferred investments, avoiding the pitfalls of taking into account the particular tax implications of an investment. To Financial Engines, all trades were considered to be tax-free because, well, they were.

But then two announcements came along in recent weeks that I think are interesting both for their implications and for how little notice was paid to them. Financial Engines services came available first at siliconinvestor.com, a popular digital hangout for investors. And more recently, Financial Engines did a deal with E*Trade and with the E*Trade/Ernst & Young partnership called eAdvisor. Financial Engines will "power" investment advice for E*Trade. Yep, that's right, advice from a discount online broker. Think of what Inktomi does for Buy.com or Hotbot and you've got it. The ability to get advice at an online broker is a significant step forward for financial services on the Net, in my opinion. And once E*Trade has it, all the E*Trade competitors will soon have it, too, possibly through eAdvisor.

And this advice is broader than that previously available from Financial Engines. It isn't limited to mutual funds and it isn't limited to tax-deferred investment accounts. Users of these systems can now get advice — presumably world-class advice tailored to their particular circumstance at that second — for regular old brokerage accounts. This business has been the historically the sacred domain of human-only financial advisors, of which there are approximately 36,000 in the U.S. We'll call them the disintermediatees.

So just as your local insurance agent is getting wacked upside the head by quotesmith.com, your local certified financial planner is about to get nuked, too. The computers of Financial Engines pretty much know what they are doing and have a much greater capacity for sending out warning e-mails when conditions change than does the guy operating from his house helping retired schoolteachers make their ends meet.

Oddly enough, though, this might be a really wonderful time to get into the financial planning business. That's not what I would have written a couple years ago, when I probably would have predicted the end of the whole profession. But time has shown that these things play out differently than one might expect. And that's what I expect here.

Sure, people can now use automated tools to do a much better job of maximizing their portfolio return than they could do with the help of the guy down the street. The Financial Engines service is vastly cheaper, more personalized, lots quicker, and doesn't have at its basis any personal agenda on the part of the advice giver. But most of the people who would use such advice to best effect probably aren't using a financial planner anyway. They are already doing it themselves because that's their nature.

So the way I think this will play out is that the really smart investors will have a new set of tools to use, and those tools will probably drive them further away from mutual funds and toward individual stocks. And the financial planners who might have been disintermediated will have the Financial Engines tools to assist their customers who don't have computers, don't like computers, or don't want to do any of the heavy lifting themselves. Where this really significant advance in investment tools might have put financial planners out of work, it will probably just help them do a better job. At least that's what I hope, given the lousy service many of these bozos offer presently.