A letter of condolence to former Amazon Affiliates

Dear Jilted Amazon Affiliates Everywhere,

Boy, it sure sucks to be dumped.

There you are, doing a great job of recommending awesome books, handing Amazon the sales, and they just up and leave the party.

To add injury to insult, I’m sure it didn’t feel good to hear from the Wall Street Journal that collective sales from your sites only *account for a relatively small slice of Amazon’s traffic, so the move isn’t likely to cause major damage to the company’s business.*

It’s like the morning after the prom, when in wrinkled dress and wilting corsage you realize they’re just not that into you. At least, not when they may have to collect millions in state sales tax that could help fix bridges, keep schools open and fund libraries at a time when your states are truly suffering.

And they seemed so nice.

Well, I want to invite you to the indie party. While the flashy prom has been happening at the country club, we’ve been holding our own get-together in the gym. What we lack in glamour, we make up for in charm. Like you, we love to recommend books. We think it’s cool that you’re recommending books, and with us there’s no such thing as too small. We won’t marginalize you. And we all pay our local taxes.

Best of all we have an affiliate program too! It’s called IndieBound, and we’d love to have you be a part of it. You’ll get a reward for using it, your readers can keep getting their books off your site, and your state will benefit in the end. Everyone wins.

Again, we’re sorry that you lost your date. (We never really liked them anyway.) We promise we won’t leave you hanging.

Sincerely,

Indie Booksellers Everywhere

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From Kristen:

Since I wrote this, there’s been a pretty big kerfuffle. Amazon has notified affiliates in Hawaii, North Carolina, and Rhode Island that they are terminating their agreements. It’s all over Twitter, and quickly spinning out of control.

I have to believe that in their hubris, Amazon really believes that the bad PR this will generate on the part of the thousands of mom and pop affiliates out there is outweighed by their not having to collect those taxes and yield the competitive advantage they have built their model on.

I don’t believe that the aggregate sales from the hundreds of thousands of affiliate partners that may be affected represents an insignificant number regardless of what they say. Especially when you consider the marketing value of those millions of little Amazon links on websites everywhere. I think they are throwing their weight around to get their way but they better be careful.

Hell knows no wrath like a knitter scorned.

Andy Ross, former owner of the wonderful bookstore Cody’s in Berkeley, CA and now the principal of  The Andy Ross Agency has been following the issue in relation to a similar initiative in his state. He has long been fighting for e-fairness.

He had this to say via an e-mail response earlier today:

When I was a bookseller out here, I worked for about 10 years with Hut Landon and Bill Petrocelli to get a law passed like the NY law. It got thwarted by the Tech industry.

So Hawaii has a similar bill. And Amazon threatened the same thing (as they have done in North Carolina). I just heard that the Gov of Hawaii vetoed the Amazon bill. So they are having an impact.

The affiliate program with Amazon is huge (I think) not just because it is driving sales to Amazon, but because of the huge promotional factor that this creates.

But I suppose that Amazon’s ability to evade sales tax gives them such a competitive advantage over local businesses that it trumps the affiliate programs. Really, it is like the state of California (and most other states), giving a tax break so that an out of state company can get a competitive advantage over a local company. This is like jumping down the rabbit hole.

I’ve been following this story closely for about 10 years. Amazon has, protean-like, changed their excuse why they should be excused from collecting these taxes.

First they said that they shouldn’t have to collect sales tax because the Internet was a frail and delicate bird  and should be given a break to build this new economic engine. At the same time they said that the Internet was the economic juggernaut that was driving the new economy. (How Internet commerce could be both a frail bird and an economic juggernaut has always been puzzling to me.)

Then they said that they were totally flummoxed by the complexity of having to collect so many different amounts of sales tax from the 5000 discrete tax districts in America. This from the company who had no problem keeping track of the reading habits of 20,000,000 consumers.

Then they said that the laws were unconstitutional. Hmm. I always thought that it was the Supreme Court who made that determination.

As Tennessee Williams famously said: “I smell the smell of mendacity in this room”.

Amen, brother.