Calif. lawmakers approve Amazon tax compromise (AP) : Technet

Calif. lawmakers approve Amazon tax compromise (AP)
US gets chance to catch up on credit card security (AP)
Sims Social Zooms Past FarmVille to Become Number 2 Game on Facebook (Mashable)
What people are saying about the postal service (AP)
Alibaba's Ma says he's not the reason for Bartz's departure (Reuters)
Adobe Gives Up on Flash for iPhone and iPad (ContributorNetwork)
Facebook App Allows Users to Dedicate Status to 9/11 Victims (ContributorNetwork)
An app to tell your 9/11 story (Appolicious)
JibJab dances its way to iPads with childen’s storybook app (Appolicious)

Calif. lawmakers approve Amazon tax compromise (AP)

Posted: 09 Sep 2011 11:51 PM PDT

By ADAM WEINTRAUB, Associated Press Adam Weintraub, Associated Press – Sat Sep 10, 2:51 am ET

SACRAMENTO, Calif. – Lawmakers on Friday sent Gov. Jerry Brown a compromise bill that delays California's effort to force online retailers such as Amazon.com to collect the state's sales taxes while retailers lobby Congress for national rules governing online sales taxes.

The state Assembly approved AB155 on a bipartisan, 59-8 vote in the final hours of this year's legislative session. The bill had passed the Senate, 36-1, hours earlier.

Democratic Assemblywoman Nancy Skinner of Berkeley, one of the bill's authors, called it a ground-breaking agreement that could help level the playing field between traditional and online retailers.

"We finally will give certainty to our California businesses ... that the unfair tax advantage that has been enjoyed by out-of-state online retailers will finally end," Skinner said before the vote. "While it will not end this instant, it will end."

The compromise between lawmakers, Amazon.com and traditional retailers would delay the expanded online tax collections until at least September 2012. That would give Amazon and other retailers time to lobby Congress for national rules governing online sales taxes.

AB155 would eliminate an estimated $200 million in tax revenue the state had been counting on this fiscal year. The governor has not offered an opinion.

California this year joined a growing wave of states that tried to boost tax collections by expanding the definition of "physical presence" in the state to include marketing affiliates, who steer online customers to the retail site, and sister companies such as Amazon's Silicon Valley subsidiary that developed the Kindle electronic book reader.

Internet retailers said the move was illegal. Amazon cut ties to California affiliates and spent more than $5 million to gather signatures for a 2012 ballot referendum to repeal the law. Brown signed the original bill in June as part of the state budget package.

Under the compromise passed Friday, Amazon agreed to resume working with its affiliates.

"This bipartisan, win-win legislation will allow Amazon to bring thousands of jobs and hundreds of millions of investment dollars to California, and welcome back to work tens of thousands of California-based advertising affiliates," Paul Misener, Amazon's vice president of global public policy, said in a statement.

Republicans who supported the compromise called it better than allowing the referendum to move forward.

"It does save a very, very expensive and very divisive referendum campaign, pitting Amazon versus Wal-Mart, pitting brick and mortar versus online," said Assemblyman Chris Norby, R-Fullerton. "They'd be trashing each other."

The debate over whether online retailers must collect taxes from customers in other states involves billions of dollars across the nation.

A 1992 U.S. Supreme Court decision involving a mail-order company established that retailers only have to collect state tax if they have a physical presence in the state, such as a retail store. Customers who buy from out-of-state retailers are supposed to pay the sales and use tax directly to their home state, but few do.

As Amazon and other online retailers took a larger share of the market, traditional retailers argued that the tax rules unfairly cut into their business by giving online sellers a price advantage. State and local governments also cried foul about outdated laws that never envisioned a retail store in every Web browser and cost them tax revenue.

"The retailers and Amazon now go back to Washington, D.C., together to lobby for national legislation to ensure that all Internet sellers collect the taxes. So this is good," said Senate President Pro Tem Darrell Steinberg, D-Sacramento.

He said the compromise provides the state with the certainty of future revenue, even if collections are delayed until next fall.

"We actually achieved peace with a delicate compromise here," said Senate Minority Leader Bob Dutton, R-Rancho Cucamonga.

AB155 would eliminate the language Brown signed until at least Sept. 15, 2012. When it does take effect, it would apply only to sellers with at least $1 million in annual sales, up from $500,000 in the law Brown signed.

The amendments also would require large online retailers to notify customers that they owe state tax and provide a total amount of annual purchases potentially subject to the tax.

Small online businesses criticized the compromise bill for not compelling other online retailers to collect the California sales tax. They questioned whether a federal solution will be viable.

"To be clear, this is not an equitable solution for all businesses in the state," said Rebecca Madigan, executive director of the Performance Marketing Association, Inc., a trade association. "It is, in fact, very disappointing to the 25,000 small online businesses whose incomes were devastated when the affiliate nexus tax first passed in June."

Amazon has previously dropped affiliates in Arkansas, Connecticut and Illinois after similar sales-tax collection laws were passed there. Overstock, which is based in Salt Lake City, also has shuttered its affiliate programs in several states due to the laws.

Amazon does collect sales taxes in North Dakota, Kansas, Kentucky and its home state of Washington. It collects in New York, too, as it fights the state over a 2008 law, the first to consider local affiliates enough of an in-state presence to require sales tax collection.

____

Associated Press writers Judy Lin and Don Thompson contributed to this story.

US gets chance to catch up on credit card security (AP)

Posted: 09 Sep 2011 11:50 AM PDT

By PETER SVENSSON, AP Technology Writer Peter Svensson, Ap Technology Writer – Fri Sep 9, 2:50 pm ET

NEW YORK – The next time you swipe your credit card at check-out, consider this: It's a ritual the rest of the world deems outdated and unsafe.

The United States is the only developed country still hanging on to credit and debit cards with those black magnetic stripes, the kind you swipe through retail terminals. The rest of the industrialized world has switched _or is in the process of switching_ to "smart" chip-based cards.

The problem with that black magnetic stripe on the back of your credit card is that it's about as secure as writing your account information on a postcard: everything is in the clear and can be copied. Card fraud, and the measures taken to prevent it, costs U.S. merchants, banks and consumers billions each year.

The smart cards can't be copied, which greatly reduces the potential for fraud. Smart cards with built-in chips are the equivalent of a safe: they can hide information so it can only be unlocked with the right key. Because the important information is hidden, the cards can't be replicated.

But the stripes have been so entrenched in the vast U.S. payment system that banks, payment processors and retailers have failed to reach consensus on how to revamp it, leaving the U.S. behind the rest of the world.

"The card system in this country has been dysfunctional for a long time," says Mallory Duncan, general counsel of the National Retail Federation. "We have far, far too much fraud because we have a very antiquated payment system relative to the rest of the world. This is something they should have fixed a long time ago."

Yet even here, there are now serious moves to swap conventional cards for smart cards in a few years.

Last month, Visa announced new policies that will give U.S. banks a reason to issue smart cards and stores several reasons to accept them, starting in 2015.

Eric Schindewolf, product manager for smart cards at Wells Fargo & Co., says Visa's announcement is a "watershed" moment.

"I think that the U.S. has reached a tipping point. You'll begin to see more and more smart cards in the hands of U.S. consumers," Schindewolf says.

Smart cards are recognizable by the fingernail-sized gold contacts embedded on one side. Through the contacts, a chip inside the card can transmit information to a terminal when slid into a slot.

Here's how a smart card works in practice: When it's time to settle the bill at "Le Gaspard de la Nuit," a tiny restaurant just off the Place de la Bastille in Paris, the waiter brings to the table a wireless payment terminal. The customer inserts his chip-equipped "smart" credit card and enters his code on the keypad.

Voila! The foie gras is paid for without the card leaving the customer's sight, and the combination of chip and PIN code kept the transaction safe from fraud.

The U.S. payments industry has so far been locked up in a "chicken and egg" quandary, Schindewolf says. Stores had little reason to install terminals for smart cards if banks didn't issue them, and aside from some contactless cards, banks didn't issue them because stores wouldn't accept them.

The impasse has left U.S. businesses and consumers struggling with higher fraud rates. Richard Sullivan, the senior economist in payments research at the Federal Reserve Bank of Kansas City, says that in 2006, 9 cents out every $100 paid by card in the U.S. ended up in the pockets of criminals. The comparable figure for Spain was 2 cents. Sullivan believes the use of smart cards there is a big reason for the difference. Other factors play a role, too. Spaniards, for instance, are less likely to shop online.

Javelin Strategy & Research puts the amount of fraud based on stolen card numbers in the U.S. at $14 billion. Fraud based on new card accounts created using stolen identities adds billions more — the total cost of identity fraud in the country is $37 billion.

Visa's move comes as industry experts are warning that U.S. merchants are set to become targets for fraudsters in other countries where payment systems already have tighter security. Since counterfeit magnetic-stripe cards are now difficult to use in other countries, these criminals will probably ship the cards to the U.S.

That prospect is especially worrisome now that Mexico and Canada, are adopting smart cards, experts say.

"There's already evidence that that type of channel for fraud is increasing in the U.S.," says Sullivan.

The U.S.'s status as a holdout has also started to cause problems for travelers. While most European stores and restaurants still accept magnetic-stripe cards, Americans are finding that their credit cards don't work in European automated kiosks, like the ones that sell tickets for the Paris Metro. Some U.S. banks, like Wells Fargo, have started issuing smart cards to customers who travel abroad.

Next year, Visa will start dangling this carrot in front of store owners: If they replace most of their terminals with ones that accept smart cards, they will no longer need to have their payment-system security checked every year. U.S. stores spend hundreds of millions of dollars a year for these audits, according to the NRF.

In an even more momentous shift, in 2015 Visa is shifting the liability for a certain kind of fraud from the banks to stores.

The specific case is this: If a customer presents a smart card in a store that can't accept it, then it will fall back to using the backup magnetic stripe on the card. If that transaction turns out to be fraudulent, the payment processor will be liable, and in practice, make the store eat the loss. Today, the bank would be liable for the fraud.

The change means that banks will have an incentive to put chip-based cards in their customers' hands, since their fraud liability will be reduced when the cards are used. For their part, stores will have a reason to install smart card terminals, because otherwise, their fraud costs could increase.

Javelin puts the cost of moving to chip-based cards at about $8 billion, mostly for upgrading payment terminals in stores.

The retail federation's Duncan calls Visa's move a necessary step, but not a fully satisfactory one. One of the shortcoming he sees is that it doesn't mandate the use of PIN codes with smart cards, so even if the cards can't be copied, they could still be used on a signature basis if stolen.

Smart cards won't help secure online payments either, at least not initially, so that will remain an avenue for fraudsters. But they could help secure online transactions if paired with computers that can communicate with the chips, perhaps through accessory card readers. (American Express issued PC readers for its Blue smart card in 1999. But the "smart" features on the card were proprietary to Amex, and saw very little use.)

Phone makers are also starting to build smart-card chips into cellphones, which could then be used in place of cards at "contactless" terminals and perhaps help secure online shopping done through the phone.

The world's largest retailer, Wal-Mart Stores Inc. can't wait for smart cards to come fast enough. It's frustrated with the gaping security holes in the current payment system and wants to save money on card-acceptance fees that are inflated by fraud.

Wal-Mart has already installed terminals with slots for smart cards in all its U.S. stores, and it's working on getting the behind-the-scenes software working, so it can start accepting payments. It, too, sees PIN codes as essential to the security of the system.

"Signatures are a waste of time," says Jamie Henry, senior director of payment services at the company. "They add no value to anyone."

Sims Social Zooms Past FarmVille to Become Number 2 Game on Facebook (Mashable)

Posted: 09 Sep 2011 05:35 PM PDT

Chris Taylor Chris Taylor – Fri Sep 9, 8:35 pm ET

So you thought planting crops and ploughing fields was the quintessential casual game activity on Facebook? Think again. As we reported two weeks ago, The Sims Social -- Electronic Arts' latest version of its bestselling avatar-based franchise -- is growing faster than a FarmVille weed. A week after its release, Sims Social had 4.6 million players logging in every day, which made it the 10th most popular game on Facebook. Now things are looking even better for EA, and even more serious for Zynga. In just two weeks, Sims Social has leapfrogged nine games, including longstanding Zynga hits Empires & Allies, Texas Hold 'Em, Pioneer Trail and -- yes -- FarmVille. In the last 24 hours, 9.3 million people played Sims Social, while 8.1 million played FarmVille, according to Facebook tracking site Appdata.com.

[More from Mashable: Groupon Rethinks the Timing of Its IPO [REPORT]]

Next in the Sims' sights: CityVille, the roost-ruling Zynga hit with 14 million players entering daily.

Part of what's going on here is the successful transposition of the Sims, which had such addictive qualities it sold more than 140 million copies in its various PC versions. By letting you connect to your Facebook friends' avatars, the Sims Social is finally delivering on the promise of The Sims Online, a massively multiplayer game released in 2002 and shut down in 2008.

But we're also witnessing the slow decline of FarmVille. At its peak last year, more than 32 million people harvested crops and collected coins every day. There was an English Countryside add-on, and a Lady Gaga version. But some users complained that the game was too much of a time-suck; if you didn't check in often enough, your crops would wither and die. Zynga made sure to reward players who paid for extra items that would "unwither" their crops. You could buy FarmVille currency at 7-Eleven, and cash in your Amex reward points to grow more crops.

Contrast that with the Sims, which has no penalties for infrequent checkins; your avatar and her house are just as you left them. Could its popularity herald a new era of kinder, gentler, less manic Facebook games? If the Sims can overtake CityVille as well, it just might.

This story originally published on Mashable here.

What people are saying about the postal service (AP)

Posted: 10 Sep 2011 06:04 AM PDT

By The Associated Press The Associated Press – Sat Sep 10, 9:04 am ET

People are using the Internet to pay more bills and send more messages. The weak economy is reducing advertising. So what do Americans think about the need for the post office?

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Ohio State University graduate student Allison Fisher says she pays most of her bills electronically, so if postal services were to decrease or end, it would affect her much less than it would her grandmother, who uses mail for tasks such as bill-paying.

"It just seems until everything gets converted to electronic, I think people still need, you know, the post office," she said.

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Catalina Ramos, 53, a Los Angeles care provider, said she does all of her banking and bill paying through the mail. She said she hoped the government would offer the Postal Service any needed financial support because she didn't want to see it have to cut corners to make ends meet as a private business.

Private entities such as banks offer less convenient hours, less attentive staff and less stringent data security, she said. "Everything coming from the government is better."

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Caroline Carter, a 45-year-old Montgomery, Ala., nurse, said she likes to use the Post Office when she mails gifts to out-of-town friends and family members. "It's better to me and easier to access. I'd rather come here than look for UPS," Carter said. She said she uses the Internet some for shopping, but prefers to use the post office for shipping.

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Brian Swords, 50, a trade consultant from Los Angeles, doesn't think the post office should start getting a government subsidy. He still pays some bills by mail and likes receiving magazines.

He also receives stacks of catalogs in the mail from companies such as L.L. Bean, which he and his family like paging through even though the merchandise could be ordered online. "My little girl likes it and my wife sits there and pores through it," he said.

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Jovita Camesa, 75, who lives in a downtown Los Angeles retirement complex, said she's sending more first-class mail than ever, due to her ever-expanding circle of grandchildren.

Camesa said she wouldn't think to use the Internet for those birthday and holiday greetings or start going online to seek out the articles she now reads in the issues of Vogue, Readers Digest, Prevention and other magazines that are delivered to her. "I'm not interested in the Internet or computers," she said. "I'm very traditional."

Alibaba's Ma says he's not the reason for Bartz's departure (Reuters)

Posted: 10 Sep 2011 03:58 AM PDT

– Sat Sep 10, 6:58 am ET

HANGZHOU, China (Reuters) – China's Alibaba Group Chairman Jack Ma said on Saturday he was not the reason for the departure of Yahoo Inc's chief executive.

Yahoo, which owns about 40 percent of Alibaba Group, fired its chief executive Carol Bartz on Wednesday ending a tumultuous tenure that saw the relationship between Yahoo and Alibaba fray precipitously.

Ma told the annual gathering of entrepreneurs that contrary to popular belief, he was not the reason for the departure of Yahoo's CEO.

"Over the past couple of days, the Yahoo CEO got fired, but it had nothing to do with me," Ma said at the beginning of his speech.

Ma and Bartz had a difficult relationship exacerbated by Ma's desire to buy back Yahoo's stake in his company and Yahoo's unwillingness to sell.

In May, Yahoo announced that it was unaware that Ma had spun-off its e-payment unit, Alipay, to a company wholly-owned by Ma. Alibaba countered saying Yahoo was well aware of the Alipay transfer and that it had done so to comply with domestic regulations.

The two sides and Softbank Corp settled the matter in late July.

Alibaba recently made forays in mobile, search and logistics in order to beef up its different e-commerce platforms.

Ma said Alibaba is aiming for 1 trillion yuan ($157 billion) in transaction value next year on its Taobao platform.

On Friday, Alibaba said it will launch an English version of its mobile operating system, Aliyun OS, sometime this month and a tablet running on that platform within the next two months.

"When I hear the word competition I get very excited," Ma said.

"I decided to get into search so that Baidu cannot sleep at night," Ma said adding that a monopolistic market without competition is ultimately detrimental to the user.

Alibaba Group launched Etao late last year as an e-commerce-focused search engine. Baidu Inc is China's largest search engine with more than 80 percent of the search market by traffic.

Alibaba Group is the parent company of Alibaba.com, Taobao Mall, Taobao.com, Etao and Alibaba Cloud Computing. ($1 = 6.384 Chinese Yuan)

(Reporting by Melanie Lee; Editing by)

Adobe Gives Up on Flash for iPhone and iPad (ContributorNetwork)

Posted: 10 Sep 2011 06:44 AM PDT

Jared Spurbeck Jared Spurbeck – Sat Sep 10, 9:44 am ET

Contribute content like this. Start here.

The Flash plug-in for browsers has been the de facto king of Web video, interactive websites and annoying ads that get in your face since it was owned by Macromedia. So when it was announced the iPhone would be shipping without Flash -- and wouldn't ever have Flash on it -- a lot of people freaked out. Why was Steve Jobs being so mean? Android phones are getting Flash!

As the owner of one of those Android phones that has the Flash player installed, though, I can tell you why the iPhone's not getting Flash: It's awful. It runs horribly, and horribly slow. It's a crapshoot whether it works at all, on my phone from last year, and that's just to play a Web video. And Flash games like Robot Unicorn Attack? Right out.

Fortunately, a lot of these games and videos are available through apps like the YouTube one. That's how iPhone owners watch them. And it seems Adobe has finally accepted that.

Introducing the Flash Media Server

Don't be fooled by the headline on Boy Genius Report's article. Adobe's not bringing Flash anything to iPhones or iPads. Instead, website owners can buy these Flash Media servers for upward of $995, and they'll convert Flash movies into a form that iGadgets can use.

There are a number of downsides with this plan. One, it doesn't work on all websites; only the ones with owners who paid Adobe hundreds or thousands of dollars. And two, it costs hundreds or thousands of dollars. How many bloggers and restaurant owners are going to want to shell out $995 to $4,500 just so iPhone owners can watch ads in their web browsers instead of YouTube?

If anything, Adobe's given people a reason to use HTML 5 video, or movies that play outside of Flash Player. Flash was fun while it lasted, but it's going the way of the dinosaur. This "media server" thing is just an expensive kludge to artificially extend its lifespan, by milking businesses that are addicted to it.

But iPhones can't browse the full web!

Actually, iPhone owners will have a better web browsing experience than most Android phone owners. Instead of having their battery life drained by a choppy Flash video -- one that would just crash low-end smartphones like mine -- they'll get web movies in a format their iPhone can play without breaking a sweat.

Let's face it: It's been four years since the iPhone came out, and roughly three years since the first Android phone did. Adobe has had plenty of time to make Flash do its thing, and/or beg, plead, and cajole Apple into putting Flash on the iPhone. The Flash Media Server products show that it's given up, at least on the "persuade Apple" part. And the poor quality of the Flash experience on Android smartphones and tablets suggests that it may be wise for Adobe to give up there as well.

Jared Spurbeck is an open-source software enthusiast, who uses an Android phone and an Ubuntu laptop PC. He has been writing about technology and electronics since 2008.

Facebook App Allows Users to Dedicate Status to 9/11 Victims (ContributorNetwork)

Posted: 10 Sep 2011 07:28 AM PDT

An app to tell your 9/11 story (Appolicious)

Posted: 10 Sep 2011 08:18 AM PDT

JibJab dances its way to iPads with childen’s storybook app (Appolicious)

Posted: 10 Sep 2011 05:00 AM PDT