

Did 99% Of Our Industry Just Become Criminals - dangrossman
http://www.shoemoney.com/2011/01/03/did-99-of-our-industry-just-become-criminals/

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dangrossman
I've read the bill (it's only 4 pages) and I don't understand any of his
concerns. It's a prohibition on underhanded selling of payment information to
a third party in order to sign someone up to some other purchase when they
bought something from you. That has nothing to do with upselling your own
customers with your own products, or affiliate referral programs.

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trotsky
I think "our industry" refers to CPA style affiliates. Negative option is the
same type of thing as the old book of the month club - they ship you something
and charge you for it unless you stop it or send it back. What's going on is
that there are (shady) setups designed basically to be a variable CPA. You
rope the customer in, charge them whatever you can for the upfront product and
then pass on their details to the negative option marketer. The 3rd party
fulfills the first order for free (effectively the CPA charge) and then
proceeds to bill you long term.

It would seem that the title is pretty inappropriate for HN, "our industry"
certainly doesn't match any significant part of HN.

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foulmouthboy
Just reading what's been quoted in the blog post, this makes it so that an
upsell purchase is a distinctly different transaction from a previously
completed purchase.

What was possible before: 1\. Visitor enters billing information and makes a
purchase 2\. Visitor is shown an upsell page 3\. Visitor clicks a link on the
upsell page 4\. The item that was clicked is automatically added to the
previously completed purchase

Now, step 4 isn't possible. A retailer must make it clear (by virtue of asking
for billing info again) that there is a new purchase that's about to happen.

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dangrossman
Except that this isn't in the law at all. That scenario is still completely
legal. There is no distinctly different transaction unless the upsell was to a
different company, and involved that other company separately charging the
customer.

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foulmouthboy
Well, back to the drawing board, cause the scenario I was hoping they'd fix is
highway robbery.

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SwellJoe
That's certainly not my industry. My industry doesn't involve underhanded
tactics for extracting money from customers. I don't care for regulation in
general, but this is not making honest people into criminals...this is making
things that ethical companies would never do anyway illegal.

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bugsy
Bill looks good to me and won't affect our company. I think the bill should be
extended though to non-internet transactions as well. I got bamboozled by
magazine subscriptions that autorenew themselves even though I never consented
to, the consent was in the form of an opt-out scheme.

Nothing worse than buying something for $5 and suddenly they are deducting
$49.95 from your bank account every 30 days. Hopefully this bill criminalizes
that practice. If as a side effect, I have to reenter credit card numbers into
legit sites like amazon, that's the price I pay and its no big deal.

Regarding the companies whose schemes this bill addresses, if they all go out
of business, and have their board of directors and corporate attorneys taken
out and shot by a firing squad at dawn, that would be a net gain for society.
(Reader's Digest, I'm looking at you.)

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kylelibra
I believe the original intent of the bill came about from companies selling
you a product and then launching a pop-up ad. Consumers would then click on
the ad and be billed a low, monthly recurring charge. They wouldn't be brought
to a check out screen because they had just entered all of their billing
information.

I forget a lot of the specific details surrounding this, but I think these
sorts of things are what originally prompted this bill.

It started with good intentions and then politicians got involved.

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jonhendry
"It started with good intentions and then politicians got involved."

Still sounds good to me.

Spammy things like ClickBank need to DIAF.

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dangrossman
I don't think there's anything inherently spammy about ClickBank. It's a 3rd
party payment processor with a built-in affiliate program for each merchant,
pretty harmless stuff.

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jonhendry
From their "How It Works" description:

"Alan goes to work online, posting his HopLink in search engine ads, on his
pet-training blog, and in the e-book review he writes for his favorite dog-
training forum."

Something about the way it's worded just sounds to me like they're hinting
that people should "go to work online" posting spammy 'reviews' as an excuse
to post affiliate links, and otherwise post the affiliate links far and wide.

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jtregunna
I don't think the US needs more economic problems right now. This is a huge
deal breaker for many companies, and short term, it will result in relocation
of systems to emerging markets, and other established countries, like Canada,
the European Union, Brazil, Russia, China, etc. Silly, silly move.

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techsupporter
If a business relies on stealthily moving payment information from the
merchant with whom the customer is dealing and a 3rd party, then perhaps a
"deal breaker" is necessary. A customer should be able to expect that payment
information is only handled by the merchant processing the order. Throwing
"click here for your FREE OFFER" pop-ups that contain "offer terms" signing
the user up for 360 months of charges, or hiding "print tickets now" links
amongst huge, blinking graphics about "E Z TRIALZ" that only serve to cause
credit card charges should not be recognized as good business.

Having read through the bill[1], it seems narrowly-tailored just to prevent
such annoyances. A merchant needs to understand that payment information is
arguably the second most precious thing given by a customer, and that
information needs to be protected. Yes, customers have options, but when every
seller in a particular class--I'm glaring at you, movie ticket sales websites
--has taken this scammy step, the "choice" is meaningless.

1 - <http://thomas.loc.gov/cgi-bin/query/z?c111:S.3386>:

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EGreg
The guy got it wrong. If a company wants to bring ANOTHER merchant into the
mix, AFTER the transaction has been concluded, it can’t just send my info to
them, I have to send it myself. That's what the bill says.

Amazon and ClickBank are just fine.

The question I have is, how does this affect virtual currencies and systems
where I pay money to the initial merchant and they turn around and pay someone
else (such as PayPal)?

