Amazon Makes Site Tablet-Friendly, Cuts Calif. Tax Deal

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SEATTLE –

Amazon.com

appears to be optimizing its website for tablet computers.

The new streamlined design, which is being rolled out gradually across the country, has a larger search bar, fewer buttons, and positions digital content ahead of physical merchandise on the home page, published reports indicate.

It is believed that the updated layout was developed to improve the shopping experience for users of Apple’s best-selling iPad, and in anticipation of Amazon’s own long-rumored Kindle tablet, which is expected this fall. Amazon founder/CEO Jeff Bezos has tacitly acknowledged the device, telling industry observers to “stay tuned,” while web accounts compare its physical design to Research In Motion’s Playbook Tab and suggest that a 6GB version will be released in November for $250.

Separately, Amazon could be exempt from collecting sales tax in California for another year under a deal reached this month with lawmakers.

The tax, which was enacted by Gov. Jerry Brown in June and set to go into effect in July, targeted out-ofstate e-tailers with offices, employees or affiliates in California.

Amazon has refused to pay the tax, dropped its approximately 10,000 third-party sellers within the state, and has been collecting signatures for a ballot referendum to overturn the law.

Under the compromise struck with legislators, Amazon would delay collecting taxes until September 2012, resume sales through California affiliates, and drop the $5 million referendum effort.

It is unclear at press time whether Brown will support the delay, which would give Amazon more time to lobby Congress for a national e-tail sales tax. The latter would have a positive impact on brick-and-mortar merchants, particularly within the CE and home office channels where e-commerce sales account for well over 20 percent of revenue, observed Credit Suisse retail analyst Gary Balter.

“While Amazon contends that their sales penetration is the same in the states where they already collect taxes, paraphrasing Shakespeare, ‘Me thinks [they] doth protest too much,’ ” he wrote in a research note.

Asked to comment on the California tax agreement during a second-quarter earnings call, Best Buy CEO Brian Dunn called it “an accelerant” in “the march to the inevitable leveling of what has been an atrociously unfair playing field.”

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