March 14, 2012 at 10:31 AM ET
In an about face of a policy that in recent weeks threatened to cut off the accounts of erotica e-book publishers that may publish "obscene" content, PayPal has updated its policy to focus on the removal of specific e-books, rather than mandate the removal of entire classes of books.
PayPal's director of communications, Anuj Nayar, wrote a blog post on March 8 that made it clear PayPal "is a payments company. The right to use PayPal’s service is not the same as the right to speak." And as such, it would not allow its service "to be used to purchase material focused on rape, incest or bestiality."
But back in late February, e-book publishers such as Smashwords said it was given only a few days to "achieve compliance" or else have its PayPal services deactivated. Founder Mark Coker emailed Smashwords authors, publishers and literary agents to let them know about PayPal's crackdown in requiring them to remove categories of books that may contain rape, incest or bestiality -- labeling such actions as censorship.
And with that, it was able to rally groups such as the Electronic Frontier Foundation (EFF), The American Booksellers Foundation for Free Expression (ABFFE) and the National Coalition Against Censorship (NCAC) for support.
Nayar reiterated PayPal's acceptable-use policy, which prohibits the use of the payment service for the sale of e-books that contain any of the above practices in text and/or images, as well as anything that includes child pornography.
He also tried to reassure customers and others who clamored against PayPayl for infringing on freedom of speech that the company did not shut down e-book publishers and that it was "working with the small number of affected merchants to come to a mutually agreeable solution that allows maximum freedom of expression, while protecting PayPal from the brand, regulatory and compliance risk associated with this type of content."
Nayar wrote a blog post Tuesday that updated the policy to focus on "individual books, not on entire 'classes' of books. 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. 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."
Smashwords' Coker responded with another email proclaiming victory:
"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."