Internet's effect on transaction costs and the size of firms

Below is a snip from a very interesting article in Wikipedia regarding Coase's Theorem, which describes the economic efficiency of an economic allocation or outcome in the presence of externalities.

The theorem states that when trade in an externality is possible and there are no transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of property rights. In practice, obstacles to bargaining or poorly defined property rights can prevent Coasian bargaining.

A key point when applied in the Internet age

This is one of the reasons why, in the past, companies used to grow more and more: it was better to make something in house since the cost of the transaction to buy it was high.

In the internet era, Coase's theorem became even more up to date, but under a slightly different version. The concept is the same, but the way of reading it is the opposite. We could say: "the size of a company will decrease until the cost of doing something inside the company will be lower than doing it outside".

In other words, since in the internet era the cost of the transactions became very small, as a consequence, the size of the companies is decreasing. An example of this phenomenon is the increasing pace of the outsourcing and off-shoring businesses