Prompted by comment left by Chris. I’ve looked into this story some more.
The story at Lockergnome points to a story on The New York Times (free registration required). Which goes into more (non-technical) detail. Software involved in this scam include Morpheus, Kazaa and LimeWire.
Last week, Amazon cut off affiliate payments to Morpheus, one site that employs the shopping software, said an online executive. Coldwater Creek, an online clothing store, has also blocked Morpheus….
A successful affiliate Web site can make $60,000 a month from referrals alone, said Haiko De Poel Jr., chief executive of Abestweb.
That’s a lot of money to be stealing!
At least two of the companies involved, have recently made changes to their software to stop this happening, but that of course won’t affect the millions of copies already downloaded.
Note that this redirection continues even after you have uninstalled the software!
Here’s another article about software, including KaZaa, using Microsoft’s ‘Smart Tags’ to steal visitors from web sites.
I can’t seem to find anything on the technology used, but I image it is simply that the software installs a local proxy on your machine (or hooks into one that’s already their) and parses either the incoming html to re-write the tags or the outgoing requests to substitute the affiliate number part of the well known query strings.