I describe the main aspects of a model for the gamma-ray burst (GRB) emission in which energy is dissipated gradually in a Poynting-flux-dominated flow. In this picture, the energy of the radiating particles is determined by heating and cooling balance. Detailed radiative transfer calculations show that, at Thomson optical depths of order of unity, the dominant radiative process is inverse Compton scattering. Synchrotron-self-absorbed emission and inverse Compton dominate in the Thomson thin parts of the flow. The electrons stay thermal throughout the dissipation region because of Coulomb collisions (Thomson thick part of the flow) and exchange of synchrotron photons (Thomson thin part). The resulting spectrum naturally explains the observed sub-MeV break of the GRB emission and the spectral slopes above and below the break. In this model, the Amati relation indicates a tendency for the more luminous bursts to have more energy per baryon. If this tendency also holds for individual GRB pulses, the model predicts the observed narrowing of the width of pulses with increasing photon energy. The model also predicts that the γ-ray power-law tail has a high-energy cutoff typically in the ~GeV energy range that should be observable with FERMI. A prompt emission component in the optical and UV is predicted to be associated with the GeV emission.