B&N invites Amazon affiliates to switch

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Barnes & Noble invites Amazon affiliates to switch
Reuters - 14 February 2011

"With sales of books at its bricks-and-mortar stores in a long-term decline, Barnes & Noble has invested in developing it its Web presence and its Nook electronic reader to win a share of the growing e-books market."

[aceflor]

Good for them, and in the long run of course for us. Competition will work wonders on the readers prices ...!

[snipenekkid]

Interesting take and very bold move by B&N. I don't see how a site owner could be liable for the tax on a sale they did not conduct though. Amazon is the retailer and the affiliate is simply doing nothing more than hawking the Amazon site and content no more than a road sign. So I am not sure I would make the switch on a site that is generating income to one that has a questionable future as well as present.

Add to it that the fact of the Agency 5 there is zero competition. I don't see how an affiliate will benefit other than the slim chance they are classified a retail presence which then comes down to does the location of the person or the location of the servers hosting the site constitute the determination of retail presence.

Interesting move no matter what.

[Kali Yuga]

Is the affiliate thing exclusive? Can't you set up something in a sidebar, one for Amazon and one for B&N?

[Kali Yuga]

Originally Posted by snipenekkid

I don't see how a site owner could be liable for the tax on a sale they did not conduct though. Amazon is the retailer and the affiliate is simply doing nothing more than hawking the Amazon site and content no more than a road sign.

They're also collecting payments on the purchase though.

The issue isn't settled, but I suspect it has a lot more to do with actual laws as written than our intuitions.

Originally Posted by snipenekkid

Add to it that the fact of the Agency 5 there is zero competition...

Uh, no.

Agency pricing does remove two specific aspects of competition -- price and availability.

However, this still leaves dozens of other ways for retailers to compete with one another. Retailers are still competing on: ebook reader and app quality; customer service; branding and advertising; credit options; international offerings; and, as this instance shows, affiliate services.

Originally Posted by snipenekkid

I don't see how an affiliate will benefit other than the slim chance they are classified a retail presence which then comes down to does the location of the person or the location of the servers hosting the site constitute the determination of retail presence.

Uh, no. Again. Sorry.

In this case, in theory the affiliate benefits because B&N is going to accept the headache of making sure the sales taxes are taken care of, and that if there is a problem B&N offers to take care of it. These kinds of issues could be a big headache for a one-person blog who picks up an extra $25 a month from affiliate book sales.

Separately, sales tax is determined by the physical location of the purchaser, not the seller. If I live in California (8.25% sales tax) and I purchase something online from a seller in Alabama (4% sales tax), the seller needs to collect the 8.25% sales tax and pay it to California.

So it doesn't matter where the affiliate is located. The real question is whether they hold some tax liabilities, and B&N is telling the affiliates "go with us and you won't have to worry either way."

As such B&N's offer is a benefit -- to the extent that the potential affiliate believes B&N will do what it says.

[doreenjoy]

I just can't see the benefit in tying oneself to B&N. I'd rather get a foot on the dock before the ship sinks.

[Kali Yuga]

Originally Posted by doreenjoy

I just can't see the benefit in tying oneself to B&N. I'd rather get a foot on the dock before the ship sinks.

The affiliate can terminate the contract at any time, for any reason whatsoever.

The contract does say you might have to jump through some hoops to get back on, but I doubt they're super-strict about it, unless you're clearly pulling some shenanigans (e.g. jumping on and off constantly).

[chyron8472]

Link in the OP is broken.

Try this one... or maybe I can just quote from it:

NEW YORK | Mon Feb 14, 2011 11:33am EST

NEW YORK (Reuters) - Bookstore chain Barnes & Noble Inc has invited independent Web operators that are affiliates of online retailer Amazon.com to switch to its network.

The affiliates, which are paid a fee when they drive traffic to Amazon that results in a sale, have found themselves in the middle of a battle between Amazon and several states that argue Amazon has a duty to collect sales tax when those affiliates operate in their state.

In an open letter, Barnes & Noble invited affiliates of Amazon to join its group, saying it would take care of collecting and remitting sales taxes due on Barnes & Noble Web sales on their behalf to shield them from action from state tax auditors.

Barnes & Noble also accused Amazon of preferring to harm those businesses "than comply with state law."

An Amazon spokesperson could not immediately be reached for a comment.

Barnes & Noble said its network has 13,000 affiliates.

With sales of books at its bricks-and-mortar stores in a long-term decline, Barnes & Noble has invested in developing it its Web presence and its Nook electronic reader to win a share of the growing e-books market.

(Reporting by Phil Wahba, editing by Maureen Bavdek)

btw, I live in Oklahoma which is one of the states that is trying to claim sales tax for residents' online purchases. I wonder how this will turn out.

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Originally Posted by chyron8472

Link in the OP is broken ...

Thank you! I've updated my OP.

[rhadin]

Originally Posted by chyron8472

btw, I live in Oklahoma which is one of the states that is trying to claim sales tax for residents' online purchases. I wonder how this will turn out.

It depends on whether your governor is a Rick Perry (of Texas)-type Republican or more concerned about Oklahomans than out-of-state corporations. Perry decided to kowtow to Amazon and Texas gave up trying to get Amazon to collect and remit state sales taxes, preferring to cut public services and close schools to balance the Texas budget.

[snipenekkid]

for the poster who has zero clue about the affiliate thing and who has to collect sales tax, you need to read and larn. The affiliate is nothing more that a billboard by the road side. An affiliate is not a business presence in a state, the factor that determines the whole sales tax thing. In fact the article id very explicit that it is Amazon not the affiliate. Plus it is the legal responsibility of the BUYER to report all out of state purchases and pay the correct sales tax for their municipality. It is NOT incumbant on the out of state seller to collect that tax as they do not, currently, have the legal definition of a business presence any more than an add in a magazine.

BTW, you also imply all of California has an 8.25% tax rate. Nope some cities have over a 10% tax rate. It all depends on where one lives. In fact due to recriprical agreements with other sates if someoen in say, Oregon, travels to California and buys a product all they have to do is show thier ID to verify that fact and the retailer cannot charge them any sales tax.