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  1. #1
    boczom1's Avatar
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    Default Amazon Affiliates = Gone

    Thought i'd take over for The Buzz for a sec..

    Not really casino related....but very much Affiliate related.

    They totally ditched the affiliate program in 1 day that had affiliate relations with 25,000 sites.

    This is extraordinary news and shows the desperate state of our economy. I could only imagine what the Amazon Affiliate forum is like right now..

    It's all because of California's latest Tax the Internet law.

    All these amazon affiliates are practically without a job now..

    EDIT: A bit of a typo here. I guess it's only regarding affiliates that reside in California. (still , i'd never imagine they have so many affiliate sites located in Cali - 25,000 ? ) Looks like alotta people will be moving out.

    http://www.ocregister.com/articles/a...alifornia.html

    Amazon ends deal with 25,000 California websites

    Gov. Jerry Brown has signed into law California's tax on Internet sales through affiliate advertising which will immediately cut small-business website revenue 20% to 30%, experts say.

    The bill, AB 28X, takes effect immediately. The state Board of Equalization says the tax will raise $200 million a year, but critics claim it will raise nothing because online retailers will end their affiliate programs rather than collect the tax.

    Amazon has already emailed its termination of its affiliate advertising program with 25,000 websites. The letter says, in part:

    (The bill) specifically imposes the collection of taxes from consumers on sales by online retailers - including but not limited to those referred by California-based marketing affiliates like you - even if those retailers have no physical presence in the state.

    We oppose this bill because it is unconstitutional and counterproductive. It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue. We deeply regret that we must take this action.

    The new law won't affect customers, Amazon said, but added that the immediate termination of the affiliate program also applies to endless.com, myhabit.com and smallparts.com.

    (Full disclosure: I have a personal website that has been an Amazon affiliate. It made $2 last quarter. That is not 30% of my income.) [More...]

    Almost all the California Amazon affiliates have fewer than 75 employees and a large percentage have no employees, according to Rebecca Madigan executive director of the Performance Marketing Association, a Camarillo-based nationwide trade association.

    "This law won't impact Amazon that much but it is a crisis for website owners who make revenue by placing ads on their websites for thousands of online retailers," Madigan said. "Most of them don't have a physical presence in California."

    California Retailers Association stated: "We thank Governor Jerry Brown and the leaders in the California State Legislature who have demonstrated their leadership and commitment to California businesses by passing and signing e-fairness into law. Small and large businesses across the state have been held at a major disadvantage by the current law that out-of-state online companies like Amazon.com and Overstock.com have exploited for years. This has cost us jobs and revenues."

    The U.S. Supreme Court in 1992 ruled that states cannot tax businesses that aren't physically within their boundaries. Such taxes would regulate interstate commerce, which is a federal government prerogative.

    However, New York in 2008 passed a law to require companies with online affiliate advertising programs to collect sales tax for sales through those affiliates based in New York. Since then Rhode Island, North Carolina, Illinois, Arkansas and Connecticut passed similar laws.

    Amazon is suing New York over the law, and the Performance Marketing Association is suing Illinois.

    Amazon affiliate Keith Posehn, owner of zorz.com in San Diego, said he had affiliate advertising agreements with more than 70 companies and these programs were 35% of his company revenue before the California legislature passed a similar bill last year. Then-Governor Schwarzenegger vetoed that bill.

    "We got 70 termination letters in one night before he vetoed it," Posehn said. After that, he started changing his business away from affiliate advertising and has started a new mobile application company.

    "I have pitched investors and several question the wisdom of staying in California," Posehn said. "Some venture capitalists are very keen on placing startups outside California because start-up costs are less."

    However, another Amazon affiliate, Glenn Richards, an independent recording artist in Orange County (MightyFleissRadio.com), is angry with Amazon and its head Jeff Bezos.

    "I think that Amazon.com's decision to throw their affiliates, (including myself) under the bus is a national disgrace," Richards said. "Jeff Bezos should be ashamed of his conduct. His bully boy practice and tactics of extinguishing small business in California should be (condemned). Small business has no power...and no hope to confront Internet giants like Amazon.com."

    Board of Equalization Member George Runner blasted Brown for signing the law. "Even as Governor Jerry Brown lifted his pen to sign this legislation, thousands of affiliates across California were losing their jobs. The so-called 'Amazon tax' is truly a lose-lose proposition for California. Not only won’t we see the promised revenues, we’ll actually lose income tax revenue as affiliates move to other states."
    Last edited by boczom1; 30 June 2011 at 8:31 am.

  2. #2
    Chips's Avatar
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    Anytime a state decides to tax internet sales Amazon pulls the plug in that state for affiliates. The first state was North Carolina a couple years back. I think there are around 5 states that Amazon will not permit affiliates from.
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  3. #3
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    the entire program, or just for the US?

    Because.. i've been writing this fantastic wordpress plugin in my spare time which connects to the Amazon API and creates content based on the wordpress title name.

    content on the fly!

  4. #4
    Simmo! is offline Public Member
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    Check this article out - it has the background and mentions which other States may become affected. What Amazon is doing is actually making a stand and while it may hurt some affiliates it sounds like it is for the greater good.

    http://www.quansite.net/blog/bewaret...liatenexustax/

  5. #5
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    They should theoretically dump the whole of Europe then, with our (20% in the case of the UK) VAT sales tax!
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    michael1981 is offline Public Member
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    Very harsh news for Amazon affiliates, who probably weren't even making that much anyway considering the small rev share Amazon used to pay.

  7. #7
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    I suspect they won't really loose 25k affiliate sites advertising them. I'd guess the new law taxes Amazon if they do business with companies incorporated in California rather than if they do business with companies that have some employees in California. If that is how the law is actually structured, incorporating out of state should solve the problem without requiring the people to physically move.
    Last edited by CityGuard; 1 July 2011 at 4:17 am.
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  8. #8
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  10. #9
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    Quote Originally Posted by grem View Post
    US affiliates are getting it really bad this year.
    taxes, taxes, taxes.

  11. #10
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    it is far worse than taxes. Poker affiliates losing their ability to get paid then Amazon just removing the commissions.

    It is like a penalty for being American and it gives advantage to the rest of world

  12. #11
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    The congressmen and senators don't care how it affects the PEOPLE ....

    They care about the kickbacks they get, they care about getting THEIR paycheck even if they don't show up for voting etc (one of their JOB FUNCTIONS), they care about making sure they and their family stays on the governement medical insurance program (even though their constituents are barely putting food on the table and go to work sick because they can't afford to go to the doctors)....they pretend to care about how things affect their constituents....

    ....and the main thing they care about is getting RE-ELECTED!

    I agree it is a rather agressive move by Amazon to try and combat what they see as unfairness to them and those living in the affected states.

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  14. #12
    slotplayer is offline Private Member
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    They already went after the card processors, like PayPal.
    http://taxes.about.com/od/businessta...dreporting.htm

    The only good thing is they got rid of the 1099 provision in the healthcare bill.
    http://money.cnn.com/2010/05/05/smal...re_tax_change/
    Last edited by slotplayer; 1 July 2011 at 4:08 pm.

  15. #13
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    Now SoCal wants to form its own state...

    http://losangeles.cbslocal.com/2011/...om-california/

    Official Calls For Riverside, 12 Other Counties To Secede From California
    New state would have no term limits, part-time legislature

    RIVERSIDE (CBS) — Is the state of California about to go “South”?

    Riverside County Supervisor Jeff Stone apparently thinks so, after proposing that the county lead a campaign for as many as 13 Southern California counties to secede from the state.

    Stone said in a statement late Thursday that Riverside, Imperial, San Diego, Orange, San Bernardino, Kings, Kern, Fresno, Tulare, Inyo, Madera, Mariposa and Mono counties should form the new state of South California.

    The creation of the new state would allow officials to focus on securing borders, balancing budgets, improving schools and creating a vibrant economy, he said.

    “Our taxes are too high, our schools don’t educate our children well enough, unions and other special interests have more clout in the Legislature than the general public,” Stone said in his statement.

    He unveiled his proposal on the day Gov. Jerry Brown signed budget legislation that will divert about $14 million in 2011-12 vehicle license fee revenue from four new Riverside County cities.

    Officials fear the cut will cripple the new cities of Eastvale, Jurupa Valley, Menifee and Wildomar.

    Stone said he would present his proposal to the Board of Supervisors July 12.

    The new state would have no term limits, only a part-time legislature and limits on property taxes.

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