Nelson gave a talk at Google a few months ago - Transclusion: Fixing Electronic Literature
However, they really didn't start doing that until the development of the Personal Computer... It was only in the late '70s that writers such as Algis Budrys, Vernor Vinge, William Gibson, and, yes, L. Neil Smith, started writing about the possibilities of what could be done with these new, fun devices that had been invented just a year or so before and were becoming more and more available.
The serial single connection Bulletin Board Systems (BBS) of server based information and intercommunications were appearing and hinting at what could be done. Some enterprising BBS sysops got several phone lines and modems and arranged for more than one connection at a time to their servers. This resulted in chatting... and shared gaming. All done on personal microcomputers.
Precursors of the Internet were already appearing in 1978... including email and tech support from Infoplex which in 1980 added chat functions with a CB Simulator and evolved into Compuserve.
Noting the growing popularity of home computing, they started thinking about and incorporating many of these evolving technologies into their writing and extrapolating, looking for "What kind of things will we do in the future with these things besides play game, do word processing, and storing recipes?" Most of these writers had friends, if not themselves, who had experience with Arpanet and Usenet and their shared information databases and discussion boards. They started adding two and two and getting quite a bit more than four.
But all of this did not really start in SciFi until the Personal Computer was available.
Read an article from MIT's Technological Review that I just posted on FreeRepublic.
On Science Fiction - How it influences the imaginations of technologists.