Since not everyone has received this letter I'm posting it. This is not the final say in the matter, instead this will give you some background on what's going on.
(forgot to add this in earlier) Sign the Petition, please. http://www.thepetitionsite.com/7/stop-internet-censorship/
February 24, 2012 Re: Your Smashwords account at http://smashwords.com/profile/view/sarayork Dear Smashwords Authors, Publishers and Literary Agents, This email is being sent to all authors, publishers and agents who have published erotica at Smashwords. We will also post this message to Site Updates and the Press Room. According to our records, you pubish 4 erotica-categorized title(s) out of 4 title(s) now live in the Smashwords system. This message may or may not pertain to you. Today we are modifying our Terms of Service to clarify our policies regarding erotic fiction that contains bestiality, rape and incest. If you write in any of these categories, please carefully read the instructions below and remove such content from Smashwords. If you don’t write in these categories, you can disregard this message. PayPal is requiring Smashwords to immediately begin removing the above-mentioned categories of books. Please review your title(s) and proactively remove and archive such works if you are affected. I apologize for the short notice, and I’m especially sorry for any financial or emotional hardship this may cause the authors and publishers affected by this change. As you may have heard, in the last couple weeks PayPal began aggressively enforcing a prohibition against online retailers selling certain types of "obscene" content. For good background on the issue, see this Selena Kitt post here - http://selenakitt.com/blog/index.php/2012/02/19/slippery-slope-erotica-censorship/ or here - http://theselfpublishingrevolution.blogspot.com/2012/02/slippery-slope-erotica-censorship.html#comment-form or this Kindleboards thread here - http://www.kindleboards.com/index.php/topic,104604.0.html On Saturday, February 18, PayPal’s enforcement division contacted Smashwords with an ultimatum. As with the other ebook retailers affected by this enforcement, PayPal gave us only a few days to achieve compliance otherwise they threatened to deactivate our PayPal services. I've had multiple conversations with PayPal over the last several days to better understand their requirements. Their team has been helpful, forthcoming and supportive of the Smashwords mission. I appreciate their willingness to engage in dialogue. Although they have tried their best to delineate their policies, gray areas remain. Their hot buttons are bestiality, rape-for-titillation, incest and underage erotica. The underage erotica is not a problem for us. We already have some of the industry’s strictest policies prohibiting underage characters (we don’t even allow non-participating minors to appear in erotica), and our vetting team is always on the lookout for "barely legal" content where supposed adults are placed in underage situations. The other three areas of bestiality, rape and incest were less well-defined in our Terms of Service (https://www.smashwords.com/about/tos) before today. I’ll tackle these one-by-one below, and I'll provide you a summary of the changes that will go into effect immediately. *Incest:* Until now, we didn’t have a policy prohibiting incest between consenting adults, or its non-biological variation commonly known as "Pseudo-incest." Neither did our retailer partners. We’ve noticed a surge of PI books over the last few months, and many of them have "Daddy" in the title. I wouldn't be surprised if the surge in "Daddy" titles prompted PayPal to pursue this purge (I don't know). PI usually explores sexual relations between consenting adult stepchildren with their step parents, or between step-siblings. Effectively immediately, we no longer allow incest of any variety in erotica. Like many writers, censorship of any form greatly concerns me. It is with some reluctance that I have made the decision to prohibit incest-themed erotica at Smashwords. Regardless of your opinion on incest, it’s a slippery slope when we allow others to control what we think and write. Fiction is fantasy. It’s not real. It unfolds in our imagination. I’ve always believed fiction writers and readers should have the freedom to explore diverse topics and situations in the privacy of their own mind. From an imagination perspective, erotica is little different from a literary novel that puts us inside the mind of farm animals (1984), or a thriller novel that puts us inside the mind of a terrorist, or a horror novel that puts us inside the mind of an axe-murderer or their victim. All fiction takes us somewhere. We read fiction to be moved, and to feel. Sometimes we want to feel touched, moved, or disturbed. A reader should have the right to feel moved however they desire to be moved. Incest, however, carries thorny baggage. The legality of incest is murky. It creates a potential legal liability for Smashwords as our business and our books become more present in more jurisdictions around the world. Anything that threatens Smashwords directly threatens our ability to serve the greater interests of all Smashwords authors, publishers, retailers and customers who rely upon us as the world’s leading distributor of indie ebooks. The business considerations compel me to not fall on the sword for incest. I realize this is an imperfect decision. The slippery slope is dangerous, but I believe this imperfect decision is in the best interest of the community we serve. *Bestiality:* Until now, we didn’t have a stated policy regarding bestiality. I like animals. Call me old fashioned or hypocritical (I’m not a vegetarian), but I don’t want to be a party to anyone enjoying animals for sexual gratification, for the same reason we’ve never allowed pedophilia books. I don’t want to publish it, sell it, or distribute it. The TOS is now modified to reflect this. Note this does not apply to shape-shifters common in paranormal romance provided the were-creature characters are getting it on in their human form. Sorry I need to clarify it that way, but we don’t want to see bestiality erotica masquerading as paranormal romance. *Rape:* Although our Terms of Service prohibits books that advocate violence against others, we did not specifically identify rape. This was an oversight on our part. Now we have clarified the policy. We do not want books that contain rape for the purpose of titillation. At Smashwords, rape has no longer has a place in erotica. It has no place anywhere else if the purpose is to titillate. Non-consensual BDSM - or any other form of non-consensual violence against another person - is prohibited. *NEXT STEPS:* If you have titles at Smashwords that are now expressly forbidden, by the end of day Monday (Feb 27), please click to your Dashboard at https://www.smashwords.com/dashboard and click UNPUBLISH then click ARCHIVE. This will also cause our automated systems to remove the titles from retail distribution. DO NOT try to hide or obfuscate violating content by changing book titles, book descriptions and tags. If we discover such shenanigans, said authors/publishers will risk account deletion and forfeiture of any accrued earnings, per our Terms of Service. We take violations of the TOS seriously, because such violations jeopardize the opportunities for your fellow authors. We do not want to see PayPal clamp down further against erotica. We think our authors should be allowed to publish erotica. Erotica, despite the attacks it faces from moralists, is a category worthy of protection. Erotica allows readers to safely explore aspects of sexuality that they might never want to explore in the real world. The moralists forget that we humans are all sexual creatures, and the biggest sex organ is the brain. If it were not the case, none of us would be here. Erotica authors are facing discrimination, plain and simple. Topics that are perfectly acceptable in mainstream fiction are verboten in erotica. That’s not fair. Our decisions today are imperfect. Please, act responsibly, don’t try to game the system or publish content that pushes the limits of legality. Help us continue to help indie authors around the world to continue to publish and distribute with freedom. *THINGS TO AVOID:* Avoid using words such as 'bestiality,' 'rape,' 'incest,' 'underage,' or 'barely legal' in book titles, book descriptions or keyword tags, otherwise Smashwords may conclude you’re violating the Terms of Service, or trying to push the limits. If you’re writing non-erotic works, and any of these words are necessary, then you’re okay. On Tuesday (Feb 28) we will begin removing content that we deem in violation. When we remove a title, you will receive an email notifying you of such, and that email will append this letter along with instructions on how to notify us if we made an error. I promise you, we will make mistakes, so please work with us, take a deep breath and honor us with your patience. If you believe we removed something in error, please click "Comments/questions," mention the title we removed, provide the hyperlink to said title, and provide your *calm* reasoning for why we should reconsider. Our support team is backlogged, so it may take several days for them to respond. As we mention in the Terms of Service, we reserve the right to remove anything for any reason. That said, we will also try to make our decisions with care and prudence. You might wonder if Smashwords should simply switch to a different payment provider. It’s not so easy. PayPal is designed into the wiring of the Smashwords platform. They run the credit card processing for our retail store, and they’re how we pay our authors and publishers. PayPal is also an extremely popular, trusted payment option for our customers. It is not feasible for us to simply switch to another provider, should such a suitable provider even exist, especially with so few days notice. Please note our Terms of Service is subject to additional modifications as we work to bring Smashwords into compliance with PayPal requirements. Let’s hope today’s actions mark the limit of the slippery slope. Significant gray area remain. Erotica is still permitted, though if authors try to push the limits of what’s permitted, we risk further clamping down. Please be responsible. Don’t go there. If you’re going to push the limits, push the limits of great writing, not the limits of legality. Thank you for assisting our compliance efforts on such short notice. We know these decisions will be upsetting to some of our authors and publishers, and for that we apologize. We do believe, however, that these decisions will place us on a stronger footing to represent the best interests all indie authors and publishers from here forward. Best wishes, Mark Coker Founder Smashwords P.S. Please contact our support team for inquiries regarding this change in our Terms of Service by clicking the "comments/questions" link at the top of any page at Smashwords. If your inquiry regards a specific title, please include the hyperlink to the book page of that specific title.