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If the merchant does not have a hot offer then the publisher will obviously have the power because the merchant will have to convince (persuade) a publisher to run their offer.
Ex: Look at the recent growth in the online poker industry.
4 yrs back hardly anyone knew about it, today everyone is becoming an affiliate for them due to high returns they offer to affs and also value for money for the players.
the merchant will always have the power as he drives the industry and affiliates are like distributors or networking channel.