The idea of turning key words in a paragraph into links.
I guess you could say that Micro Soft Smart Tags meet that definition!
At Med Scape, we used this term to refer to a list we'd put on each "specialty home page" of relevant phrases, and each would generate a fancy Ver Ity Search Engine request (exact phrases, exclusions, etc.). Much more granular/dynamic than a Cate Gory.
in 2001 I wrote The big problem with categories is (a) the way they morph over time as you change your mental map (categories are just an abstract grouping), combined with (b) the huge hassles of re-coding old entries for new category definitions. An approach I somtimes consider is (a) defining lots of keywords, (b) assigning all appropriate keywords to a given entry, and (c) grouping keywords into categories (so the user views a category listing, which is basically a big OR query of a list of keywords). That way, as your map changes, you may rename categories, and change what keywords go into them, without too much effort. And if you add a new keyword and don't want to go back and assign old entries, well there's a decent change some tangentially-related legacy keywords has already been assigned to most of the appropriate entries. Hmm, reminds me of a search engine with a thesaurus, in a way... at Medscape, where we were already using a big Verity engine, we defined HyperKeywords to work in a similar way, though we didn't use a thesaurus (we also did some categorization).
We talked about doing some auto-linking right in our body content, but there were enough cases where we felt the context would be wrong that we didn't do it. (Wish Info World would learn that lesson!)