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PayPal Updates Erotica Policy: Target Is Specific Books With Obscene Images, Not Just Words

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This just in… As we reported it would do yesterday, PayPal has today issued a significant update to its acceptable use policy regarding payments for certain erotica-themed e-books.

Now the eBay-owned payments company says that it will only prohibit using its payment system for specific books — not entire classes of books — and that it will only apply to those publications that contain pictures as well as words, and in that case only instances where those images are obscene as defined by the U.S. legal system.

This is a big reversal from the company’s policy as it set out last month, when it wrote to several e-book distributors mandating that they remove erotica covering rape, incest and bestiality from their catalogs, or face being barred from using PayPal to process orders and other transactions related to the sale of those books.

PayPal in its blog post also notes that instead of instant cancellations, it will work with publishers to resolve the situation when violations of the policy are thought to have occurred.

“Instead of demanding that e-book publishers remove all books in a category, we will provide notice to the seller of the specific e-books, if any, that we believe violate our policy,” he notes. “We are working with e-book publishers on a process that will provide any affected site operator or author the opportunity to respond to and challenge a notice that an e-book violates the policy.” It says it has not shut down any accounts of e-book publishers as a result of this situation.

The news may come as vindication (and victory) to organizations like the Electronic Frontier Foundation, e-book distributors like Smashwords and the dozens of authors and others who vocally disagreed with the company for taking its original stance.

(Although  there will likely still be people who will claim that PayPal’s revised policy does not go far enough and that it should not be involved at all in making any decisions on the content of what gets sold via its payment systems.)

Mark Coker, the CEO of Smashwords, was the person who originally made public PayPal’s policy on erotica when it was first issued in February. (We were one of the first outlets, apparently, who picked up the news, he says. That story is here.)

In an email he sent out to authors and publishers who work with Smashwords alerting them to the changes just moments ago, he notes that his company is now rolling back their policy to pre-February 24 terms (in other words, how it had been before PayPal’s mandate). He also sums up the meaning of this event quite well:

“This is a big, bold move by PayPal.  It represents a watershed decision that protects the rights of writers to write, publish and distribute legal fiction.  It also protects the rights of readers to purchase and enjoy all fiction in the privacy of their own imagination. It clarifies and rationalizes the role of financial services providers and pulls them out of the business of censoring legal fiction.”