2 min read

Major Online Retailers Form Lobbying Group

The Online Retail Alliance will hold its first meeting next week to outline strategy on three issues: privacy, state sales taxes and Internet access.
Some of the nation's largest online retailers launched on Friday a lobbying group formed to influence Congress as it tackles privacy, taxes, Internet access and other issues related to the Web, organizers said Friday.

The Online Retail Alliance is expected to serve as a collective voice for Internet retailers. ORA members include the Electronic Retailing Association, EBay Inc., InterActiveCorp and its subsidiary the Home Shopping Network, ShopNBC and others.

The group is scheduled to have its first meeting next week to outline its yearlong strategy on three issues: privacy, state sales taxes and Internet access.

The need for privacy, which is the protection of customers' personal information; and sales taxes, which states have the right to collect, are not being challenged, Bill McClellan, director of government affairs for the Electronic Retailing Association, said. But how both items are administered are concerns of ORA members.

Without industry input, mandates on how to protect consumer information and collect taxes could end up costing more than smaller retailers can afford, McClellan said.

"It could cost these guys and arm and a leg," he said.

Congress is considering some privacy legislation, and the states are in the process of putting together a proposal for collecting and distributing sales taxes, McClellan said.

On Internet access, which retailers call "net neutrality," the ORA is looking for legislation that would ensure a level playing field on the Internet, as consumers sign up in increasing numbers for broadband with cable operators and telephone companies.

With so many people depending on these two industries for Internet access, the ORA is concerned that cable and telephone companies could sign deals that would make it easier for consumers to visit the sites of some retailers, at the expense of others.

Congress is expected to take up the issue of net neutrality in rewriting the Telecommunications Act.

Work on all three issues is just starting on the congressional level, but retailers believe they need to get involved in the process immediately, in order to have an impact.

"(Retailers) have to get involved now before it's too late," McCellan said. "The decisions that legislators make can destroy a business model."