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Boaz Berkowitz  

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  • Amazon/Overstock Gamble May Pay Off [View article]

    More Bad news for those opposed to the tax. A Supreme Court justice in Manhattan has dismissed the lawsuit saying that Amazon and Overstock have no basis for the legal action. They have the right to appeal and this could go all the way up to the US Supreme Court. Of course in the meantime, New Yorkers are stuck paying sales tax on most internet purchases. Time to move to Jersey!
    Feb 24, 2009. 06:39 AM | 1 Like Like |Link to Comment
  • It's a Mad, Mad, Mad Madoff World [View article]
    Good summary and great title!
    Dec 14, 2008. 04:28 AM | Likes Like |Link to Comment
  • Microsoft and eBay Team Up: Desperate or Brilliant? [View article]

    The amount of actual cashback has been fluctuating. After a steady few days at 30%, it fell to 25% last night and 20% this morning. Even more interesting is the questionable practices that a number of eBay sellers have been implementing to abuse the cashback program. For example, I've seen $500 gift cards selling at $600 "Buy It Now" or higher. After all, after a 30% cashback, the buyer would still only be paying $420 for a $500 gift card, but the Seller would be getting $600!

    The forums have interesting stories as well. I read about one enterprising individual who buys items on ebay, gets his cashback and then immediately reposts them on ebay at the original price. He pockets the cashback profit. Sometimes he will even have the original seller ship directly to his buyer and no one is the wiser.

    I also read about one unscrupulous pair of brothers who posted and sold items to eachother. No property actually changed hands but they would split the cashback. So one would post a non-existent item for $500, the other would purchase it immediately and they would split the $150 profit (less any minor ebay/paypal fees).

    This is a complete abuse of the cashback program and may end up hurting ebay much more than it realized!
    Dec 3, 2008. 08:31 AM | 3 Likes Like |Link to Comment
  • Microsoft and eBay Team Up: Desperate or Brilliant? [View article]
    To Mr Jackdee
    I enjoyed your comment very much as it gave me a chuckle, I like your sense of humor. But just to clarify, as I said in the article, this promotion isn't new in itself nor did I ever claim that a 10% promo coupon was something new (though it is rare to receive one - my wife received a coupon, I did not and rarely have). I believe others have expounded upon the deeper issues that I touched upon so I don't feel obligated to repeat them again here. But there is another issue you have missed: While you and I may have known about the promotion, I believe by far the majority of Americans did not and I wanted to help spread the holiday cheer. Of course there are some who may agree with you and turn their noses up when offered 30-40% off their holiday shopping bills. But I think most Americans would be very happy to save so much, this season more so than ever before. Times are tough these days and I'd like to think that maybe my article helped make them a little brighter for some.

    Though caveat emptor- some ebay sellers have started raising their prices now that they are aware of the cashback program. Make sure your final price is still a deal.

    Now tell me, where can I find me one of those new Lisa computers you were talking about?
    Dec 2, 2008. 09:41 AM | 1 Like Like |Link to Comment
  • Microsoft and eBay Team Up: Desperate or Brilliant? [View article]
    To Mr. Hernje, I'm afraid I don't really understand your comment. My apologies if my writing was not clear. What I meant is that I like eBay for being eBay and Amazon for being Amazon and I shop accordingly. I feel that eBay is trying to compete head to head against Amazon and is changing their business model to be more like them. I have bought and sold items on eBay both personally and professionally for over 10 years and believe I have a good understanding of the way the company works. But in recent years, I have become increasingly dissastisfied with the way they have run their business and over that time, I have been using their site considerably less. The majority of my dissatisfaction has come with the changes that have impacted sellers rather than buyers though. eBay is still my best bet if I'm looking to buy or sell an obscure item. Otherwise I'm more likely to use Amazon. Or at least I was until they started charging sales tax. But that's a different story which can be found here:
    Dec 2, 2008. 09:26 AM | 2 Likes Like |Link to Comment
  • Another Great Depression... Not [View article]
    I was enjoying this positive outlook until Smarty_Pants ruined it for me. Impressive job done on the research Smarty. Perry still makes some valid arguments though or at least I hope so.
    Oct 23, 2008. 09:57 AM | Likes Like |Link to Comment
  • Amazon/Overstock Gamble May Pay Off [View article]

    Thank you all for your comments and thank you to user "dumb money 76" for providing some interesting contrast to my article. Mr. (or Ms.) dumb money 76, you are correct on several points. As I mentioned in the article, New Yorkers have always been required to pay sales tax on their online purchases but few if any do. In a similar vein, people are supposed to pay income tax on the profits they make from selling their old junk at garage sales or on eBay. But again, few do. What I failed to mention however, is that one has to keep in mind why brick and mortar stores charge sales tax. The money is used for services that benefit these stores such as maintaining roads, repairing electricity, trash collection, etc. Amazon, Overstock and other sites based outside of NY receive no such benefits. NY's "Amazon Tax" may be closing a loophole in the law or even leveling the playing field as you suggest, but I'm not convinced Amazon should be subsidizing the government services that Barnes & Noble receive in NY. And is it really leveling the field? There are advantages and disadvantages to buying an item online besides sales tax. A customer may save on the sales tax but at the same time, they may have to pay much more for shipping and/or endure lengthy ship times. And in the spirit of true competition, Barnes & Noble should not petition that Amazon be forced to charge sales tax as well (brick and mortar companies have been lobbying for this law for years) but rather should be forced to find creative ways at competing with Amazon on their own core strengths (price is one of Amazon's core strengths not theirs). For instance, one way Barnes and Noble successfully accomplished this has been by offering Manhattan customers same day delivery, something Amazon's business model could never offer.

    Perhaps a solution would be to charge sales tax to all customers with the tax revenues going to the website's home state. For instance, Overstock is based in Utah, so it might make more sense for them to charge Utah sales tax on all sales which could be used to subsidize services within their own state, not New York. But of course that would involve a huge overhaul of our current tax laws. But am I against a sales tax as some readers have suggested? As a consumer, I of course prefer paying lower prices for items but as a U.S. citizen I appreciate the value that paying taxes offers to society. But those who made this accusation are missing the point. The question isn't whether Amazon should be charging tax to New Yorkers, the question is whether New York's new law is technically illegal? And regardless, is it bad for New York? While I am no law expert, I think it is a stretch to claim affiliates qualify as a legal presence. And yes, I do think it can hurt NY businesses. First of all, if NY succeeds in keeping this tax on the books, other states are virtually guaranteed to pass similar laws of their own. Which means people may shun NY based internet companies, for those based in states that haven't passed such a law. Additionally, larger internet stores will likely follow Overstock's lead and shun them as well. Overstock may have been trying to send a message to Albany that the law will hurt NY businesses, but it was also a simple mathematical equation. As explained in their most recent earnings call transcript (, they calculated that they would lose more business by charging sales tax to New Yorkers than they would by abandoning their NY affiliates. If NY actually fights the lawsuits and wins, I think we will be seeing Amazon employ the same math and if their calculation brings the same result, Amazon’s affiliates will be out the door as well. Why haven't they done this yet? Amazon is very focused on customer service and my hunch is that they believe NY will either back down or lose the lawsuit. If that happens, there will be no need to kick out their NY affiliates and will have generated tremendous goodwill by not having done so. Especially in light of Overstock's abandonment of theirs. Plus many of Overstock's 3,400 NY affiliates will likely join Amazon now that Overstock has closed its doors to them. When this all blows over, many of them will probably choose not to rejoin Overstock. So as much as I hate paying more at Amazon, I thin this was a good move for them.

    As for the user “Lisa” who requested an update, there unfortunately isn’t much to report. While a bill to repeal the law has passed the Senate by a wide margin (voting 6-24-08), it wasn't passed until the last day of New York's Session. The bill still needs to be approved by the Assembly to become law and that can't happen before the next Session which will not be until January, 2009.

    Meanwhile, I’m afraid my article may have been overly optimistic. Even if the bill to repeal the tax passes the Assembly, according to Saul Hansell at the NY Times (, it seems that Governor Paterson will likely veto it. So at the end of the day, those that want to see the Amazon tax repealed may have their hopes hinge on the outcome of Amazon and Overstock's lawsuits. And that could take a long time to resolve. It will also cost NY taxpayers a lot of money in lawyer's fees. Unfortunately, New York is very creative at finding ways to charge sales tax and if they lose the lawsuits, they'll likely find some other way to increase tax revenues. Anyone else remember when New York State sent agents to stake out New Jersey malls in 1992 to record NY license plate numbers? They were trying to crackdown on New Yorkers crossing the border to save on the lower taxes. It makes me wonder if New York would be more effective in increasing tax revenues by being competitive and actually lowered the NY tax rate. Then maybe our neighboring states would be flocking to NY stores instead of the other way around.
    Aug 19, 2008. 04:42 AM | 1 Like Like |Link to Comment
  • Amazon vs. EBay: Looking Beyond E-Commerce [View article]
    This was a well put together article and I agree completely. One other issue that will be interesting is how eBay recently decided to eliminate its "level playing field" concept which is what made eBay a success in the first place. eBay started out giving the little guys a chance to compete with the big guys. Everyone was charged the same fees to compete evenly in what has become the world’s largest market place. But eBay is now giving the big guys a price advantage in the form of lower fees for high volume inventories (starting with This is a complete about face of the level playing field mantra; it gives a decided advantage to the big players once again in a misguided attempt at making eBay more Amazon Marketplace-esque. This, combined with the ever increasing fee structure does not bode well for the many users who have turned their eBay sales into a small home business and depend on this income for their livelihood. It convinced many eBay users that the company cares more about profits than them. Of course most eBay users were already convinced of that. Without serious changes eBay’s glory days are behind them and the future lies with Amazon . Amazon has time and time again proven its creativity and adaptability in seizing new business opportunities.
    Aug 18, 2008. 09:51 AM | Likes Like |Link to Comment
  • Amazon vs. EBay: Looking Beyond E-Commerce [View article]
    Great Article!
    Aug 18, 2008. 04:15 AM | Likes Like |Link to Comment