Many (if not most) of these vendors rely heavily on PayPal for transaction processing. Account suspension would (at least temporarily) be akin to closing up shop. Revenue would plummet, at least until another payment processing system was implemented.
Since my post, Smashwords caved, and the latest is A1AdultEbooks, a niche bookstore for hardcore BDSM:
This is an urgent announcement to all authors and publishers who either currently have books on Fiction4All and A1AdultEbooks or who have done so in the past. If you have left us in the past this announcement will not specifically apply to you, but it will apply when and if you decide to publish with us again.
As some of you will be painfully aware, PayPal is clamping down on what content they will allow in the arena of erotic literature. Specifically they are clamping down on the areas of `underage`, `bestiality`, `rape` and `incest`. The first 2 categories are not relevant to Fiction4All and A1AdultEbooks as we have never accepted such content. However, we do have some potential issues with the new PayPal definitions of `rape` and `incest`.
PayPal are clamping down on what is widely referred to as `pseudo-incest` - adult relationships between step-parent and non-blood related offspring.
They are also widening the definition of `rape` to include any non-consensual sexual activity. We have always had a policy banning `rape` when mentioned as such but we now have to consider the wider implications of the `non-consensual` definition being applied by PayPal.
Because of the changes being imposed by PayPal, Fiction4All has been forced to take the same decision as almost all major publishers - with immediate effect we will no longer publish or offer for sale books where the title, cover or synopsis suggests a book contains either incest or pseudo-incest relationships.
We have a bigger problem on some sites in that BDSM is a major theme in many of the stories we sell. It may be that if PayPal complain about those stories we will have to stop using PayPal on those sites for a while until we can resolve what PayPal and the card companies will and will not allow. That is a headache for the future.
For now, the definition of incest and pseudo-incest is more clear cut and one we can act to take control of. This is a pro-active measure to prevent PayPal removing their services from us, which would have a major impact on all sales.
We will be going through our list of titles over the next few days and removing from sale any title we consider is likely to breach the `incest` and `pseudo-incest` definitions now banned by PayPal and we will email you individually if we have to remove any title from sale. Such titles will then be `blocked` so they can not be returned to sale.
We will also be updating our publishing guidelines for authors and publishers to reflect this as soon as possible.
I have already discussed things with a few authors and I think some titles which look like they may fall into the banned categories, can be changed so that they are more accurately titled and described (if this can apply to your books then please let me know).
If all you write is erotica between consenting, non-related adults, or between husband and wife, then this does NOT affect you.
I`m sorry to have to write in this vein and add another layer of misery to a lot of people who have been experiencing the clampdown on their own, but as this already affects Amazon, Excessica, BookFinder, Apple, Sony, Barnes and Noble, and many others, I think it is only a matter of time before all ecommerce sites will be affected. As to the future - if you are an author, sadly I suggest you stick to what is known to be safe to sell!
CEO Fiction4All (including A1AdultEbooks)
Now, eventually -- precisely because there is a market for the types of fiction being targeted -- the industry will adjust. Until then, authors who put food on their tables from the sales of such fiction are quite screwed. Those who "merely" want a venue for their artistic expression can offer their work via email or other means. Literotica is a popular host of free content that doesn't shy away from edgier work, and it has a huge audience. Yes, it mixes the pearls with the swine. Then again, some claim that indie publishing does the same.
Think this doesn't impact you as an author, a reader, a publisher, and/or a vendor because you don't deal in "that kind" of erotica? Take off your blinders.
peace & passion,