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Local Pagosa Springs News
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| Good-bye, Amazon, My Friend |
| Bill Hudson | 3/8/10 |
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| Back to the News Summaries |
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A few years back, while helping one of my web design clients get her products better positioned at Amazon.com — the world’s largest online retailer — I signed up as an Associate, meaning that I could advertise individual Amazon products on my own websites and receive a small commission whenever my web visitors “clicked through” to Amazon and made a purchase of those products.
Amazon.com is one of the iconic companies of the Internet era, with over $19 billion — yes, folks, that's "billion" — in annual sales in 2007. It began in 1994 as an online bookstore, but later began methodically expanding from one product category to another: CDs, movies, toys, furniture, groceries.
Today the company and its Associates sell everything from jewelry to golf gear on Amazon.com.
 The company didn’t make a profit until 2002, and its stock was hammered during the dot-com bust; up until about 2007, Amazon stock remained below $40 a share. But by 2007, the company was on the upswing, aided by the migration of consumers to the Web, growing trust in e-commerce, and Amazon's overall reputation for good prices, broad selection and convenience. The current stock price is about $125 a share.
At the end of 2009, Amazon.com had over 28,000 Associates helping them sell their products.
I never used my Associate membership, and in fact, I had totally forgotten about signing up. But apparently, Amazon keeps better track of these things than I do.
This morning, I received the following email communication from Amazon — and I realized, sadly, that I could easily have become another business victim of our Colorado state government's never-ending, and seemingly insatiable, quest for more tax revenues.
Here’s the email, in full:
“Dear Colorado-based Amazon Associate:
“We are writing from the Amazon Associates Program to inform you that the Colorado government recently enacted a law to impose sales tax regulations on online retailers. The regulations are burdensome and no other state has similar rules. The new regulations do not require online retailers to collect sales tax. Instead, they are clearly intended to increase the compliance burden to a point where online retailers will be induced to "voluntarily" collect Colorado sales tax -- a course we won't take.
“We and many others strongly opposed this legislation, known as HB 10-1193, but it was enacted anyway. Regrettably, as a result of the new law, we have decided to stop advertising through Associates based in Colorado. We plan to continue to sell to Colorado residents, however, and will advertise through other channels, including through Associates based in other states.
“There is a right way for Colorado to pursue its revenue goals, but this new law is a wrong way. As we repeatedly communicated to Colorado legislators, including those who sponsored and supported the new law, we are not opposed to collecting sales tax within a constitutionally-permissible system applied even-handedly. The US Supreme Court has defined what would be constitutional, and if Colorado would repeal the current law or follow the constitutional approach to collection, we would welcome the opportunity to reinstate Colorado-based Associates.
“You may express your views of Colorado's new law to members of the General Assembly and to Governor Ritter, who signed the bill.
“Your Associates account has been closed as of March 8, 2010, and we will no longer pay advertising fees for customers you refer to Amazon.com after that date. Please be assured that all qualifying advertising fees earned prior to March 8, 2010, will be processed and paid in accordance with our regular payment schedule. Based on your account closure date of March 8, any final payments will be paid by May 31, 2010.
“We have enjoyed working with you and other Colorado-based participants in the Amazon Associates Program, and wish you all the best in your future.
“Best Regards, The Amazon Associates Team” |
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