Borders began operating its own Web site in 1998, but after three years of losses from online sales, outsourced its online operations to Amazon.com. Amazon.com had the technical knowl- edge and plenty of infrastructure capacity to operate both a Borders.com and a Waldenbooks. com Web site. Under the terms of the agreement, Amazon.com was the merchant of record for all Web site sales and determined all prices and other terms and conditions for such sales. Amazon.com was also responsible for the fulfillment of all products sold through the Web sites and kept all payments from customers. Borders received commissions on sales for products pur- chased through the Web sites.