Let’s play some word association. Ready?
Now, please tell me the first thing in your mind was the name “Benedict Arnold”. No? Well hold that thought for a moment and I’ll ask you again in a minute.
If you work anywhere near affiliate marketing and have been conscious during the last few months then you should know about California’s Affiliate Nexus Tax. The law is touted by its proponents as a legitimate correction of what brick and mortar merchants decry as an unfair advantage held by online merchants such as Amazon.com. To affiliate marketers the tax is more a legalized shake-down. Rumor has it that some among our industry have already begun moving their operations out of the state in reaction to it. Amazon.com itself notified California affiliates with lightning speed about their regrets, parting best wishes, etc.. The ink in
Governor Jerry Brown’s signature was hardly even dry. There was no confusion in the minds of any of the parties involved about the impact of the law on affiliate marketing.
California is not alone in seeking to remove the protective shield for Internet-based retailers that the U.S. Supreme Court already upheld. It has certainly made the most noise with its new law though. Initially that noise seemed to be a positive thing for our industry because of the way it galvanized affiliate marketers and others aligned with them in performance marketing to fight back. In recent weeks strong efforts by the Performance Marketing Association and others have resulted in a wider awareness and a movement to push a petition started by Amazon that would allow California voters a ballot on the Nexus Tax law. Despite what could be perceived as small victories coming out of those efforts Amazon has left our camp in the night and run to the other side according to the L.A. Times article published online September 7th. Apparently the efforts of all involved failed to comfort those at Amazon’s helm because a deal has been all but struck now and it’s a deal that leaves the affiliates out in the cold unless you look at it with the rosiest of rose-colored glasses. If Amazon has its deal blessed by Governor Brown then not only does the referendum ballot go away but a crude legislative barrier will be erected to ensure that no more such nuisances get in the way of California finalizing their blatant act of extortion against affiliate marketers.
Some will say that Amazon is simply buying time. Some will say that inevitably the Feds will be involved and California’s hand, like other states, will be forced in one direction or another. But this article isn’t about speculation really or even detailed analysis of the law and the misguided support it seems to have gained from people unfamiliar with what it entails aside from just sales tax for California’s empty coffers. This article is about a big company that was built on the backs of affiliates and now is bending them over in a different way.
Now about that word association game from earlier…