Electronic Commerce

Two years ago, as online grocers fed with huge amounts of money were sprouting up, a tiny Aliso Viejo service began taking grocery orders over the Internet and making deliveries to buyers in south Orange County. WhyRunOut.com seemed an unlikely rival to huge outfits such as HomeGrocer.com and WebVan Group, which bought fleets of trucks, built big warehouses and made bigger headlines. But WebVan, which took over HomeGrocer last year, posted losses of more than $1 billion before closing Monday.

Once determined to remain strictly an out-of-state online retailer, Amazon.com is now undergoing a California makeover. The world's biggest Internet retailer on Thursday inaugurated its first California fulfillment center in San Bernardino. It will receive goods from manufacturers and process orders for quick delivery to Southern California customers -- just in time for the Christmas shopping season. Meanwhile, in San Francisco, the company has begun using a new delivery technique called Amazon Lockers.

Money-minded travelers wondering about the Internet should check out the "Snooze You Lose Specials" at Best Fares Online to see just how cutthroat airline pricing can be. You may not find the flight you want, but it's hard not to be impressed by the list of low fares, many of them unadvertised.

State lawmakers hunting for revenue are eyeing one source that could prove costly to millions of California consumers: Amazon .com. The online retail giant has enjoyed an edge over many competitors in the state because it is not required to collect sales tax from residents who buy books, top-of-the-line plasma televisions, cases of diapers and thousands of other products from its website. The Seattle corporation has no store, warehouse, office building or other physical presence in California, and the state cannot tax such businesses under a 1992 Supreme Court decision.

EBay Inc., already the master of the online auction universe, now rules the lucrative fiefdom of online payments as well. Shareholders of PayPal Inc. voted Thursday to approve a $1.25-billion acquisition that made them part of the EBay empire. In addition to earning tens of millions of dollars annually in fees from hosting online auctions, EBay can expect to pocket millions more by taking a cut of the payments.

Yahoo Inc., whose popular Web site helps computer users navigate the sprawling Internet, announced a global electronic commerce alliance with the Visa International credit card organization. In a related move, Santa Clara-based Yahoo restated its second-quarter earnings to reflect a $21.2-million one-time charge stemming from the deal, which included the issuing of more than 466,000 shares in Yahoo to Visa International.

IBM and consumer-credit agency Equifax Inc., pledging to make the Internet a trustworthy place to do business, will announce today a plan to ensure that online customers are who they claim to be, executives said. The executives said Equifax will act as an independent verifier of computer users' identities for companies using IBM's Internet commerce system.

Today Cutting Edge introduces a biweekly column, Investor's Edge, by Times staff writer Edward Silver. It will spotlight trends and strategies in the technology stock market. * Investors who aren't eager to chase the high-priced, high-profile electronic-commerce stocks don't have to give up on this promising new industry. They can just take their cue from the bargain hunters who rummage the real-world malls and shop around. Yes, there is an e-commerce business beyond Amazon.

President Clinton said Saturday he will shop online for some Christmas gifts this year and believes electronic commerce will benefit consumers and the economy if used with care and caution. "One of the key reasons our economy continues to thrive, with the longest peacetime expansion in history, is that we're making the most of new technologies," the president said in his weekly radio address.

Congress will vote this year on repealing the 102-year-old telephone tax, extending a moratorium on new Internet taxes beyond 2001 and permanently banning taxes on charges for Internet access, House Speaker Dennis J. Hastert says. In a draft speech to be delivered Monday in Chicago, the Illinois Republican said the votes will underscore Republicans as prime supporters of tax relief and electronic commerce. House Minority Leader Richard A. Gephardt (D-Mo.

On this glorious day before Christmas, I have a message for all you sales tax scofflaws out there: Pay up. This means you. You, who bought your big-screen TV online from Amazon.com instead of at Best Buy and your fleece-lined parka from L.L. Bean instead of Eddie Bauer because Amazon and Bean don't charge you sales tax and the others do. Guess what. You owe it anyway. Skipping out on the sales tax due on online purchases is the single biggest category of "noncompliance" with California sales tax law, according to the state Board of Equalization, accounting for nearly 30% of all unpaid tax. The board estimated lost revenue at $1.1 billion annually.

Twitter was just the beginning. After dreaming up the innovative social-networking medium, Jack Dorsey is looking to revolutionize another core aspect of society: money. Dorsey, the founder of Twitter, has announced that his new start-up, Square, has developed a way for anyone with a cellphone or iPod to become a merchant and accept credit card payments. Square is a small plastic device that plugs into a gadget's headphone jack. Buyers swipe their credit cards through the device, which then transmits the payment data to an application running on a connected iPhone or iPod Touch.

Monday brought a bit of early holiday cheer for online retailers as shoppers spent less time but more money with Web merchants than last year. Total online sales were up 13.7% on so-called Cyber Monday from the same day last year, with clothing and jewelry retailers leading the way, according to Coremetrics, which tracks sales for 500 member retailers. The average shopper spent $180.03 this year, up 38% from $130.04 a year earlier, said the San Mateo, Calif., online research firm.

As long as there has been online shopping, there has been Cyber Monday. But is that now more virtual than real? Online retailers for the last decade have counted on the Monday after Thanksgiving to deliver for them what Black Friday does for bricks-and-mortar stores: a turbo boost into the holiday shopping season. Online sales surged on that Monday as many people hopped on to their employers' fast Internet connections to do some holiday shopping when they returned to work after Thanksgiving.

Google Inc. started out 13 years ago as a simple search engine, but it has grown into a behemoth that has shaken up dozens of industries, including computers and cellphones. On Wednesday, it jumped into the music industry. The Mountain View, Calif., Internet giant unveiled a music search feature that lets users play millions of songs for free with an option to buy or rent them from several online music stores. Although not a direct threat to Apple Inc.'s hugely popular iTunes store, the new feature is expected to bolster the music services that compete with iTunes.

Do you miss the monkey? Once the Internet vines were full of monkeys in banner ads that, if you "punched" them with your cursor, would bring you a free Xbox or iPod or maybe $25,000 in cash -- which would be excellent simian-pummeling wages, to be sure. But the monkey -- indeed, a whole class of flashy, shaky, maddening advertising collectively known as "punch the monkey" ads -- is going away, or at least slinking off to some forgotten cavern of the Internet where few will ever see it. Like MySpace.

Calling technology "the engine of tomorrow's economy," President Clinton outlined a series of electronic-commerce initiatives Monday designed to strengthen consumer protections online, encourage the deployment of high-speed connections, and help developing countries link to the Internet.

Taking a leap into the era of electronic commerce, Lehigh Valley Safety Supply Co. recently put its work boots--a fashion staple in factories since the Industrial Revolution--for sale on the Internet. After distributing the steel-toed shoes in only a six-state region over the last two decades, the Pennsylvania firm is now booking orders 24 hours a day from corporations as far away as Indonesia.

Chas Rampenthal expects to get more business in the wake of Michael Jackson's death, but he doesn't peddle CDs, posters or celebrity memorabilia. Rampenthal sells online wills. And as general counsel of LegalZoom.com, he noticed a sharp uptick in demand when model Anna Nicole Smith died in 2007, triggering a messy battle over her estate. "All that publicity reminded people they should have an up-to-date will," he said. The same could happen as Jackson's estate gets sorted out.

More times than he can count, Gregory Day has been asked where guests of Shutters on the Beach can buy the rolling shutter doors that inspire his Santa Monica hotel's name. "I must get 10 requests a week for all kinds of things," says Day, general manager of the $500-a-night hotel. "They want to know where they can get our light fixtures, the hotel's rental bicycles, the uniforms the staff wears."