usiness hotels the world over offer X-rated movie channels. NetMate offers a cyber twist: You don't just watch; you direct the action. Launched in September 1995, NetMate charges $4.95 per minute to tune in real, and real-time, "entertainers" who respond to typed commands. "Come closer to the camera ..." Et cetera.

Because the Web reaches an educated audience, the NetMate partners, who prefer to remain anonymous, say their clientele is well-heeled: Doctors, lawyers, professors. Finding women to work in the business is a constant challenge -- they have to sound sexy and look sexy. "You have to pay more," says one partner. "You have to compete with the strip trade. We're always looking for girls."

Now that President Clinton has signed the telecommunications bill, the NetMate founders are concerned about government regulation. But business is good. "What we provide is a lot better than your average phone sex," one of them emphasized. Still, he added, "I don't do this because I like to be around naked women. It's a business decision. People are afraid to enter this market because of legal problems. But there's a lot of opportunity."