Evan Schuman's StorefrontBacktalk

As Yahoo prepares to shutter its North American auction business and phase out its photo service, it raises the question of whether Yahoo is growing up.

The four most dominant Web players—Yahoo, Google, EBay and Amazon—also happen to be among the industry's veterans. But among them, Yahoo—founded in Jan. 1994—has the most experience, followed some 19 months later by Amazon (July 1995) and then EBay (Sept. 1995). Google didn't show until three years (Sept. 1998) after EBay. Given how all over the map they've been recently, is it now time for business maturation? And will Yahoo take the lead?

When Visa released the latest stats on how many retailers are complying with PCI security rules, many large retailers don't even seem to be trying anymore.

Visa itself puts an even more favorable spin on the figures, with a statement from Visa attributed to Eduardo Perez, vice president, Payment System Risk, Visa USA, saying, "Among the top merchants, which account for over half of Visa's transaction volume, the majority are either fully compliant or working toward eliminating any deficiencies."Read more...

Amazon fired off lovely rhetoric in December, but it surrendered in the conference room. As one lawyer put it, Amazon said in December "This is extortion" and in May, said "And we're paying it."

The issues and the symbolism couldn't have been more the quintessential old versus new battle. IBM is no stranger to nasty fighting and is a company that sees something beautiful about a well-executed stealth patent. That's where a company files a patent and sits on it—quietly—to see if anyone uses the approach and if that company happens to have any money. Think of it as a Patent Speedtrap.

IBM and Amazon today announced that that they come to terms–undisclosed, naturally–on patent issues, with Amazon forking over to IBM “an undisclosed amount of money” and agreeing to “a long-term patent cross-license agreement.”

This is quite a trip from the Amazon rhetoric in December, when Amazon officials said that IBM over-reaching to an epic degree.

“IBM’s broad allegations of infringement amount to a claim that IBM invented the Internet. If IBM’s claims are believed, then not only must Amazon.com pay IBM, but everyone conducting electronic commerce over the World Wide Web (indeed, every Web site and potentially everyone who uses a Web browser to surf the Web) must pay IBM a toll for the right to do so,” court papers filed by Amazon in December said. The original IBM lawsuit raised questions of obviousness, which were addressed by …

The problem of return fraud has been plaguing retailers for many years, but two of the largest players–Target and Wal-Mart–have attacking the problem in very different ways. Wal-Mart has tried relaxing its returns policies while Target has been tightening and will continue to tighten more this summer.

Is tightening of return rules the best approach or are there better technological answers? How should those decisions be impacted by the online-offline factor? The return strategy of Target is explored in this fascinating Minneapolis Star-Tribune story, but it should have explored the technology options more. Any comments?…

The Wall Street Journal is reporting that the TJX break-in started in July 2005 with a wireless hack of a Marshalls in St. Paul, Minn, where the thieves “pointed a telescope-shaped antenna toward the store and used a laptop computer to decode data streaming through the air between hand-held price-checking devices, cash registers [POS presumably]and the store’s computers. That helped them hack into the central database of Marshalls’ parent, TJX, to repeatedly purloin information about customers.”

The news that the attack was wireless is not unexpected, as wireless attacks have become very popular means of attacking retail chains and because hints that the TJX attacks were wirelessly based have been frequent. But the level of specifics in the Journal story are surprising. Read more.…

Two security firms have crafted a fully-functional credit card with a tiny monitor and button that will issue one-time passwords. But whether any banks will offer the expensive formfactor is another question.

The concept of the card is powerful and timely, as retailers are desperately trying to improve POS security, especially for E-Commerce transactions. With thefts of credit-card identifying data growing rampant, the idea of an authentication code that—in theory—couldn't possibly be stolen from some retailer's database is quite compelling.

Although retailers have loudly complained about credit card fees for years, 2007 is suddenly seeing a surge in active support for alternative payments. The credit card companies aren't worried, but perhaps they should be.

Just in the last couple of weeks, the number of major E-Commerce sites accepting alternative payments has almost tripled, Wal-Mart has bucked the industry trend to support e-checks and two major national retail chains are going to try accepting alternative payments at their brick-and-mortars. Three strikes and you're out.

Some of the largest E-Commerce chains have suddenly started to embrace non-traditional payment methods, with one analyst firm finding a startling 267 percent increase in such acceptance in February, when compared with the identical survey done in mid-October.

Statistics, though, can be misleading, especially when the initial numbers are small. Although a 267 percent increase sounds like a landslide of non-traditional payment support, the survey also found that only 24 percent of the tracked sites offered any alternative payment.

As Borders executives discussed the various reasons they severed their multi-year partnership with Amazon.com on Thursday, the most critical was the least expected: taxes.

As a pure online play, Amazon.com was an ideal long-term partner for Borders as there was no physical store conflict. But as the years passed, that initial advantage quickly turned into the Amazon Albatross, as the online retailer couldn't doing anything in-store, for fear of running up huge tax bills in various states.Read more...

Gourmet food retailer Harry & David has thrown its apple boxes behind SAP.

The multi-channel chain—with about 130 stores in 34 U.S. states—signed off on a media statement that not only said nice things about SAP, but it took the unusual move of specifically saying that it chose SAP over Oracle. Although such a choice is not unusual, it's quite rare for a retailer to sign off on a news release that has the name of a vendor that they did not choose.

In a move that PayPal said reflects “high penetration rates” with shoppers in major European online markets, the EBay company on Wednesday said that it now has “nearly 35 million accounts in Europe.”

PayPal cited a Forrester Research report saying that 23 percent of Euro online shoppers “prefer” paying with PayPal. Last year, PayPal processed $8.4 billion of total payment volume in Europe, the company said. PayPal has a local presence in 15 countries including Austria, Belgium, France, Germany, Italy, Spain, Ireland, the Netherlands, Poland, Switzerland and the UK.…

Mirror Mirror on The Wall: Will this retailing stunt work at all? Bloomingdale’s is about to find out.

Fresh from its showing at the National Retail Federation’s tradeshow floor, IconNicholson’s social retailing demo is being trialed with Bloomingdale’s customers in New York City for two days this week. The demo involves clothing consumers shopping in the store while friends–plus quite a few strangers–watch them and give them advice.

“An interactive mirror transmits high-bandwidth video to friends who comment back via instant message and who send their own suggestions from an online catalogue,” said the Bloomingdale’s statement.…

A USA Today technology columnist learned the hard way that online-offline integration isn’t what it’s supposed to be. And it was Sears that taught him that lesson.

In the USA Today column, the writer describes having bought a microwave oven from Sears, which was supposed to be delivered and installed through the local Sears store. “Sears.com and Sears at the mall, however, don’t share a common database. My order, I learned later, had to be manually sent from Sears.com to the local store. Unfortunately, that process did not allow the dot-com folks to pass along the fact that we had paid for installation.”

After 14 phonecalls, the columnist surrendered best practises and did his own multi-channel communication: “We eventually gave someone at the retail store our Sears.com login information and walked him through our account online so he could see the original order and that we had paid for installation. We got our money back.” It’s really something IT folk need to read.…

As Connecticut state investigators continue to look into the Best Buy dual Web site situation, current and former Best Buy employees and customers are telling stories that question how accidental some of the confusion was.

The intent behind the confusion of the two sites is crucial to the investigation being conducted by the Connecticut Attorney General's Office, according to a law enforcement source within that department. Were the two sites created as legitimate tools for store associates and the confusion merely a result of insufficient training or was it a deliberate attempt to perpetrate a fraud on the public? The first hint as to intent comes from the site appearing on employee screens simply labeled "BestBuy.com," according to four sources. If the site was indeed designed to show in-store—as opposed to online—pricing, wouldn't it have been labeled in a way to reflect that? To read the full story,

The nation's largest retailer is taking shop-online-pickup-in-store to the next logical point, allowing its Web site to leverage the brick-and-mortar chain's logistical army.

Wal-Mart on Tuesday began the first phase of Site-to-Store rollout, where consumers can get free shipping online and pick up the merchandise at a local store. The move is significant not merely because any move by Wal-Mart influences the rest of retail, but because it's an ambitious attempt to truly offer a multi-channel service. The idea is for the chain to leverage the convenience of its 3,300 stores (all of which are slated to participate "by late summer," Wal-Mart said) and marry it with the almost unlimited virtual inventory possible online. To read the full story,

As the Connecticut Attorney General's Office continues the probe into possible fraud accusations against the $31 billion retail chain, retailer's executives concede errors.

As it tries to navigate the minefield that today's multi-channel retail strategies have become, Best Buy officials are conceding "human error" and employee "confusion" caused customers to be shown a site showing higher brick-and-mortar prices while the customer was incorrectly being told that the displayed site was showing online prices, according to interviews with Best Buy officials.Read more...

With more than 90,000 employees, what was Best Buy thinking when it created two employee-accessible versions of its Web site that look exactly the same, except that each had different prices?

In any dramatic story—and this Best Buy dual-Web-site story is starting to become deliciously dramatic—there are good characters and bad characters. In a really good dramatic story, those good/bad distinctions are much more complex and they invariably are dependent on perspective, the reader's point of view.Read more...

Best Buy is getting into some hot water because of an intrastore version of its Web site. The Connecticut Attorney General's office has launched a probe into the chain's use of an internal version of its Web site that looks and acts virtually identical to the public Web version except that it sometimes offers higher prices, according to Connecticut Attorney General Richard Blumenthal.

Blumenthal, in a brief telephone interview with StorefrontBacktalk on Saturday, said his office began the probe after a column published by The Hartford Courant raised questions about the site. To read the full story,

The abrupt 200-point plunge in stock prices this week sent investors running to sell shares and Web admin struggling to keep sites from crashing. As people looked at the incredible strain placed on Web servers this week when the market took a massive tumble, a frequently-heard comparison was with retailers fighting holiday shoppers.

There are two reasons such a comparison doesn't work. First, the start and likely end of E-Commerce heightened purchases are precisely known and known for more than a year in advance. Tuesday's plummet came with no warning.Read more...

Our Week In Review audiocast returned this week, courtesy of guests from Forrester Research, IHL and the Retail Systems Alert Group. This week’s show was hosted by eWEEK.

Topics included the latest from the TJX ongoing saga and Forrester’s predictions of the top E-Commerce trends for 2007.…

MasterCard has now confirmed that TJX had not been compliant with PCI rules at the time of its massive data breach, according to an employee of a MasterCard PR agency.

Specifically, the agency person said that MasterCard has now “confirmed that TJX’s acquiring bank had identified them as not yet compliant.” This follows a report Monday from ePayNews.com, which added that MasterCard “understands that TJX was actively working toward compliance.” The story suggested–and the MasterCard source confirmed–that the acquirer was Cincinnati, Ohio-based Fifth Third Processing Solutions, which is apparently TJX’s sole acquirer in the U.S..

The suggestion that TJX had not been PCI-compliant at the time of the breach is hardly news–with widespread reports raising questions about both inadedquate encryption and improper data retention–but MasterCard publicly confirming it is is unusual.…

For years, manufacturers have avoided the direct-to-consumer E-Commerce route to avoid channel conflict, fearing that if they started taking revenue away from their retail sales partners, their partners would resist.

A new Forrester Research report sees that trend reversing this year, citing Apple Computer's AppleStores and Callaway Golf as good examples. Callaway Golf, the report pointed out, "collects orders on its Web site but then has one of its retailers that carries the item fulfill the order for customers. This is a win-win-win for the manufacturer, the retailer, and the customer." To read the full story,

At a major industry conference in Barcelona this week, 14 significant telecom vendors pledged to support mobile POS as a part of a "new initiative," although there appears to be nothing new about the announcement at all.

The fourteen operators, which a joint news release says represents "more than 900 million mobile users," are Cingular Wireless (AT&T); China Mobile; KALL; KTF; MCI; MTN; NTT DoCoMo; Rogers Wireless; Smart Communications; Telenor, TeliaSonera; Telecom Italia; Turkcell, and Vimpelcom. To read the full story,

The Discover Card people have launched a 1,000-person trial with Motorola to try mobile phone payments via the Discover Network in Chicago and Salt Lake City.

The near-field communications (NFC) trial will initially allow participants to check card balances and payment history in addition to making purchases—all solely using their cellphone. The pilot uses Motorola phones and its “M-Wallet” software and is designed to test the entire infrastructure associated with accessing real time account information over the air.…