Fidelity is the largest mutual fund company in the United States. While they have reorganized and diversified beyond that core aspect of its business, ETFs apparently are not part of the plan.

On other fronts, the company has reported market share gains this year with more money flowing in across its expanded range of financial services, reports Mark Jewell for The Washington Post. Those include individual retirement planning, employee benefit management and brokerage operations.

Is skipping out on the growing ETF industry wise? Investors bought more ETFs in the first half of this year than they did in the same period last year, reports Sue Asci for Investment News. The net inflows also increased: $35 billion in the first six months of 2009 vs. $26 billion in 2008.

Some feel that Fidelity is positioned to do just fine without ETFs. However, other big names in the mutual fund industry have entered the ETF space, most notably PIMCO. Further studies have supported the need for ETFs. One survey of financial advisors found that many expect to reduce their clients’ holdings of mutual funds to 27% in 2011, down 30% from today, and 35% in 2007. By 2011, expect ETF holdings to make up around 14% of their portfolios, or 8% more from now.

On the other hand, two-thirds of Fidelity’s revenue comes from 401(k)s. If the markets are up or even flat for an extended period of time, and their average fee is north of 1.1% and investors are now beginning to pour money into their 401(k)s again, why should Fidelity be motivated to offer ETFs and cannibalize their current business model?

• Fidelity NASDAQ Composite Index Tracking (ONEQ): up 26.9% year-to-date

I’ll add tom’s comments later

A case in point is Fidelity, which has just one lone ETF: the Nasdaq Composite ETF (ONEQ).

But could it be time to celebrate? Pimco’s announcement that it would be getting into the ETF business has been greeted with equal parts excitement and more questions.

Jim Wiandt and Matt Hougan for Index Universe say that while it’s an exciting development, only time will tell whether this is just a testing of the waters or an all-out acceptance of ETFs by the mutual fund industry as more than a radical fringe investment.

Overall, Wiandt feels that Pimco’s step is a big deal for the ETF industry, but in the long run, it’s going to take some more big players to get serious about their ETF offerings.

For now, just wait and watch. This could be the dawning of a new era in investing…or it could be business as usual.