Smashwords Update

[stormcloude]

Smashwords has posted a press release with an update about their dealings with Paypal here.

To me it sounds like a lot of justification and rationalization for some poor business decisions-- ie: to be so integrated with paypal that they can't change payment processors. They seem to be pointing at all financial institutions as being behind these demands, which is shady on a whole other level.

(Yet a little corner of my conspiracy-loving heart has to wonder if maybe the big NY publishing houses don't have their finger in this pie too. After all, aren't indie publishers and sellers the biggest threat on their horizon?)

And it's hit Huffpo.

Comments

[dharma_slut]

Smashwords is being soooo embarrassing about this.

[qem_chibati]

Actually, finding financial processors who do not object to adult content, is extremely hard. DreaMwidth found one, but they won't name it publicly so it can't be harassed and if i recall correctly they've said it was a difficult decision that they looked at over a hundred processors.


So while I am disappointed they couldn't come to a similar solution, I find it understandable, since this is in the fine print for a lot of financial processors - no adult content. (too many people reversing charges when they get caught buying porn...)

[kaiz]

Additional information available at MetaFilter, too.

[iosonochesono]

DreamWidth found one, but they won't name it publicly so it can't be harassed

That was quite wise of them, because the next thing you'd know Common Sense media and social conservatives would be looking to put pressure on the company :/

[stormcloude]

I love the comments at metafilter. Thanks for the link.

[stormcloude]

And yet hundreds, if not thousands of porn sites, sex toy sellers, DVD stores that also carry adult videos manage just fine? I don't get that. Not to mention ebay's adult section isn't affected? It still seems pretty sketchy and targeted to me. and then on top of that, paypal gave them an impossible deadline to meet?

[stormcloude]

I sort of agree, but I don't think paypal is an innocent bystander by any means.

[dharma_slut]

Paypal is a money transfer facilitator. That's all.

[stormcloude]

I know. So why do they think they can regulate what their merchants can and can't carry?

[dharma_slut]

Because they can.


I opened a paypal account back in 2002 and I knew at that time that it would be very iffy for me to sell adult items.
I do anyway, but I have always known that it's an "Anyway" situation, and if Paypal wants to throw the hammer down they can.

It is NOT a matter of morals, except indirectly-- because porn is so badly regarded on our society, the percentage of chargebacks is much much higher than any other type of purchase-- huge enough to be a noticeable profit loss for transaction facilitators. Money movers hate to lose profits.

[dharma_slut]

The porn sites are willing to pay vary high transaction rates, which they pass on to us the consumers.

[kaiz]

the percentage of chargebacks is much much higher than any other type of purchase

I've always wondered about that regarding books in general and ebooks in particular.

I can see, say, porn subscriptions or videos generating a lot of chargebacks. But I wonder how the rate of chargebacks on erotic ebooks or paper books compares to the rate of returns for generic fiction books. I fully admit that am completely speculating without any data at all here, but it just strikes me as surprising if the return rate were significantly different.

Which in turn makes me wonder about additional motives that facilitators such as Paypal might have for choosing not to allow payment for erotic books.

[dharma_slut]

At a guess, mother fucking, child fucking, dog fucking, and rape-- might be a higher chargeback on those titles than other forms of porn.

What I wonder is-- what would it take to create an alternative to Mastercard and Visa? That's what I wonder.

[kaiz]

Well, setting aside materials that might actually be illegal depending upon the depiction and the jurisdiction (e.g. textual child porn)--and in which a company like Paypal would obviously have a huge legal incentive to avoid, the other topics seem to often be mentioned in the blurb or communicated by the via the genre (e.g. BDSM, or incest, or shapeshifter urban fantasy). Which might actually reduce the likelihood of getting surprise werewolf bdsm knotting porn. In comparison to snagging a copy of Flowers In the Attic (incest) or My Secret Garden (rape fantasies) that was lurking in the bargain bin next to Da Vinci Code or Cold Mountain at Barnes & Noble.

But hey, as I said before, maybe my hunch is wrong and you're right that those categories will, because of their highly culturally charged content of course have a higher return rate. I would love to find out some actual numbers from a online publisher to see which genres and sub-genres have the most returns.

Re. the alternative to MC/VISA, the folks at Bitcoin appear to be taking a crack at that.