SmashWords vs. PayPal vs. Credit Card Companies

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Wow, it’s the Battle of the Century, huh?

I have to hand it to the folks at SmashWords who sent us out another update this morning. They really are in there fighting the good fight with dignity, intelligence and rationality. Good for them! Much luck to them! Of course, since they’re dignified and rational that means I don’t really have to be.🙂

In part, SmashWords e-mail read:
In case you haven’t heard, about two weeks ago, PayPal contacted Smashwords and
gave us a surprise ultimatum: Remove all titles containing bestiality, rape
or incest, otherwise they threatened to deactivate our PayPal account. We engaged
them in discussions and on Monday they gave us a temporary reprieve as we continue
to work in good faith to find a suitable solution.

PayPal tells us that their crackdown is necessary so that they can remain in
compliance with the requirements of the banks and credit card associations (likely
Visa, MasterCard, Discover, American Express, though they didn’t mention them
by name).

The second paragraph has to do with some ‘Obscenity Clause’ the credit card companies supposedly in have their contract with PayPal. I would think PayPal signed some type of ‘standard contract’ and this odd restriction isn’t limited to them. I base that decision on the idea that most people think moving from PayPal to Google CheckOut (or similar) is only a temporary fix as the credit card companies have this ‘Obscenity Clause’ in their contracts with other internet financial middlemen as well.

My question is this: If the above is true and it all tracks back to prudish credit card companies, why can I got into probably 80% of Adult Stores in the United States and buy whatever I want with my Visa or Master Card? I can get videos, books of all types, toys of all types, costumes, oils, and just a really wonderful array of things that some people might consider ‘objectionable’ but will NOT cause my credit card to be rejected? Sounds like some sort of double standard or just plain old Bull Shit…you choose which one you like best. I don’t really care. Are the credit card companies going to start pulling the accounts of the Adult Stores that use them?

I don’t think so. They’d be out a whole lotta cash.

Are they going to start yanking support from the porn sites that use them? They may…or may not…go through our buddy PayPal but there’s plenty of those sites out there that take Visa, Master Card, Discovery et al in one form or another. And some of them charge outrage prices depending upon your tastes. Personally, I consider ‘visual’ porn much more ‘objectionable’ than books. Your mileage may vary.

So, yes, given the above, this ‘Obscenity Clause’ does appear to be being unfairly applied to Independent Authors in general, just Erotica Writers….many of which just so happened to be Indies. Yes, to me, it does smack of back door censorship. I know, I know, companies such as these have the right to determine which types of transactions they’ll handle. That’s true. I support that. I just want it applied evenly across the board if it’s going to be applied at all. Is that really so much to ask?

If I can go into “In The Mood” (a local Adult Store that gives Wal-Mart a run for it’s a money as far as size and selection of merchandise goes) and swipe my Visa/Master Card to buy assorted items such as; vibrator, dildo, XXX video, oils,lotions, gag ball, whip, chains, butt plug……I really don’t see why I shouldn’t be allowed to use it to buy a racy book online, do you?

About lbdarling

Beware...the truth is spoken here. If you can't handle that...buh-bye.

Posted on 03/03/2012, in Life, The Writer's Life and tagged , , , , , , , , , . Bookmark the permalink. 3 Comments.

  1. B.Z.R. Vukovina

    I’ve been following this story, too. I think the reason for the “double standard” stems from a decision PayPal made a few years ago. They decided to relax their no-adult-stuff rule to allow for buying/selling of objects (things that could be shipped: toys, DVDs, books) while maintaining their prohibition on everything* that didn’t have a physical existence (e.g. ebooks, video streams).

    To quote a forum user: “But, if you sell porn in digital download, PayPal doesn’t want that business. It’s easy for someone to steal credit cards. When you ship a DVD, there is a physical address you can trace; but when it’s just digital download, by the time you know the thief has hit, he’s long gone.”


    Why enforce against ebooks now?

    I don’t know. Maybe it’s due to a rise in sales. It would be interesting to see whether PayPal would do with two sellers selling the same novel: one in print, the other as an ebook.

    • Not every ‘physical address’ is actually that. Not every place that receives mail on behalf of anyone even requires ID. Add that to the fact that I’m almost never asked for any ID when I swipe my card at a store and the argument doesn’t really hold much water. Identity thieves don’t solely work/make purchases on the Internet.

  2. B.Z.R. Vukovina

    * what PayPal would do…

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