Texas Sends Amazon $269M Sales Tax Bill; Could Woot Have Pushed Texas Over The Edge?

from the that's-one-expensive-bag-o'-crap dept

For years, we've had stories about battles between state governments and Amazon (and, to a lesser extent, other online retailers) over collection of sales tax. Under the law, mail order retailers only have to collect sales tax in states where they have a physical presence. In other states, the end users (the buyers) are supposed to report and pay the sales tax themselves, though almost no one does that. Some states, such as New York, have tried to get around this by declaring anyone who's a member of an affiliate program to represent a physical presence, leading Amazon to kill off affiliate programs in certain states. When the legal battle over this happened in New York, a reporter in Texas noted that Amazon appears to have a distribution facility in Texas, and asked lawmakers how come Amazon didn't collect sales tax in Texas. Amazon apparently tried to tap dance around this for a couple years, claiming that the distribution center is owned by a subsidiary, rather than by the e-commerce firm itself (yeah, nice try).

But things appear to have become a bit more complex since Amazon bought Woot at the end of June. Woot, of course, is based in Texas. So, that makes it even harder for Amazon to claim a lack of a presence in Texas... and now, the state has sent Amazon a whopping $269 million bill for unpaid sales tax, going back a few years. Now, it certainly does appear that Amazon was pretty clearly ignoring the law on sales tax here, but it seems like Woot may have to step up how many bags of crap it needs to sell to help cover the bill.

Filed Under: sales tax, texas
Companies: amazon, woot

Woot Asks AP To Pay Up For Quoting Woot Blog Post Without Paying [Updated]

from the a-bottle-of-awesomesauce-please dept

There are so many reasons to love Woot, including their recent awesome letter and video about their acquisition. But, even better may be that in today's Woot offering, they mock the Associated Press for its coverage of the Woot acquisition, because the AP just happens to have also copied text from the awesome Woot letter. Now, that's all well and good for most publications, but this is the AP that we're talking about. The same AP that threatens bloggers for copying headlines and snippets. The same AP that insists it needs "hot news" to protect others from "free riding" on its work. And, most importantly, the same AP that has a famously ridiculous pricelist for quoting five words or more from an AP article.

It appears the folks over at Woot noticed this price list, and noticed that the AP report on its acquisition copied more than five words. And thus, the smart folks at Woot calculated that the AP owes Woot $17.50 for quoting Woot without permission (though, they'll take buying today's deal as payment instead). Of course, I would have probably added a "hot news" freerider surcharge as well. After all, people reading the AP story now no longer had any reason to go to Woot directly to find out the news. Hell, at least folks like us linked directly to Woot's letter. But that's far too neighborly a thing for the AP to do. Instead, it just quotes with no link at all.

Update: An apparently upset AP media relations person has contacted us to ask us if it's a "slow news day" (answer: no, not at all -- why do you ask?). Also, according to the AP, the article also shows that the AP spoke to Woot's CEO on the phone, and that, apparently, makes what the AP did okay. If only I had known that the AP's fair use quoting rates had an exception for "we spoke to you on the phone." Unfortunately, I don't see those exceptions anywhere. Perhaps I'm missing them. The AP would also like to remind us that it's reporting on the oil spill in the gulf. No, I don't understand this non sequitur either, but that's how the email concludes. In the meantime, I'm still wondering if the AP paid Woot for the news of reporting on them. If not, isn't the AP "freeloading" on the newsmaker? Or do the rules the AP sets out for everyone else not apply to the AP?

Filed Under: fair use, quoting, woot
Companies: amazon, associated press, woot

Amazon Acquires Woot; Woot CEO Pens Best Acquisition Letter Ever

from the earning-a-living-on-snarky-commentary-and-junk dept

It appears that Amazon is expanding by trying to buy up cool e-commerce companies that have unique and fun cultures that its fans love. I would imagine there are worse strategies out there. We already covered how Amazon bought Zappos, with the company culture playing an important role in the decision-making. Now Amazon has bought Woot (a site, I should admit, that I have a bit of an addiction to). And unlike the lame corporate-speak note that Zappos put out when it was acquired, Woot has handled the announcement in true Woot-like fashion with perhaps the best CEO letter you'll ever read about an acquisition. Here's just an excerpt:

Over the next few days, you will probably read headlines that say "Matt Rutledge revealed to be monstrous pseudo-human creation of Jeff Bezos." You might even see this photo making the rounds. Rest assured that these rumors have nothing to do with our final decision. We think now is the right time to join with Amazon because, quite simply, every company that becomes a subsidiary gets two free downloads until the end of July, and we very much need that new thing with Trent Reznor's wife on our iPods.

Other than that, we plan to continue to run Woot the way we have always run Woot -- with a wall of ideas and a dartboard. From a practical point of view, it will be as if we are simply adding one person to the organizational hierarchy, except that one person will just happen to be a billion-dollar company that could buy and sell each and every one of you like you were office furniture. Nevertheless, don't worry that our culture will suddenly take a leap forward and become cutting-edge. We're still going to be the same old bottom-feeders our customers and readers have come to know and love, and each and every one of their pre-written insult macros will still be just as valid in a week, two weeks, or even next year. For Woot, our vision remains the same: somehow earning a living on snarky commentary and junk.

We are excited about doing this for all sorts of reasons. One, our business model is so vague that there's no way Amazon can possibly change what it is we're truly doing: preparing the way for the rise of the Lava Men in 2012....

And then there's this lovely rap video Woot staff put together to explain the acquisition. The video even ends by noting "the preceding video does not represent the view or opinions of Amazon.com. Obviously." Let's just say that it's not your standard bland "hey we've been acquired" announcement: Taking a step back, it's pretty interesting to see Amazon acquiring companies with such unique cultures and then leaving them alone and letting them act entirely independently. It will be worth watching to see if that lasts (or if it can last). But for now, it's cool to see.

Filed Under: acquisitions
Companies: amazon, woot