A cute horn player from the Extra Action Marching Band wrote me recently with a letter he received from online money processing business PayPal:
You are receiving this email because you have asked to be notified of PayPal policy updates. Please read below to learn about PayPal’s most recent policy updates.
User Agreement Update
Notice Date: April 10, 2003
Effective Date: June 12, 2003
PayPal has updated its Acceptable Use Policy to simplify the policy on transactions of adult items. After June 12, 2003, PayPal will no longer process transactions for adult items through the Mature Audiences category on eBay.com. As a result, after June 12, PayPal will no longer process payments for adult items anywhere on the Internet.
PayPal strives to find the right balance between serving our community and minimizing our financial risk. We feel that exiting the Mature Audiences category with a clear and consistent policy for all adult items best achieves this balance.
As part of this effort, we are extending the deadline for when PayPal customers must stop sending and receiving payments for tangible adult products, including magazines, DVDs and videocassettes. Originally May 12, this deadline has now been extended to June 12 to correspond with the phase-out of PayPal service for these items on eBay. The deadline to stop sending and receiving payments for digital adult products and services, including online photos, streaming video and audio services, will remain May 12. For more information on our Mature Audience Policy, log in to your PayPal account and click on "Policy Updates" in the What’s New box. You will find a link to the Mature Audience Policy under the April 10, 2003, User Agreement Update.
I responded to (tromboner) with:
(tromboner), thank you for sending me this, it is definitely of interest. Just what exactly is the rationale behind this decision, I wonder? We can only guess. PayPal cannot legislate the morality of its customers, but it seems that surely they will try. Are they being pressured by a "family values" group? Maybe — I know that these groups have recently declared a war on porn and are attempting to amass "god’s army." Not kidding, it’s scary, and they’re doing this with grassroots-style church letter writing campaigns to cable companies like Viacom to make them stop broadcasting cable porn. Buncha sickos — they’re clearly obsessed with pornography.
But here is, I think, the rub: PayPal may cut off everything and all adult, but surely this is where a large amount of their revenue comes from, and as all in the adult biz know, sex accoutrements are an ever-growing, recession-proof source of revenue. Especially as more and more people become comfortable with enjoying their sexuality, and see the benefits of occasional experimentation. Then what for PayPal? Shot in the foot? That would be a nice irony, much like the male adult store owner who "found god," burned 10K worth of his stock (it’s bad karma to destroy sex toys, BTW), and turned "Love World" into a christian store called "Mike’s Place." Since then, he’s foundering on the brink of financial devastation, save for the donations he’s been getting from other sexually repressed god- (and orgasm-) fearing christians (which are not the only flavor of christian out there, but nobody seems to know that, either). But it was a nice way for Mr. Former Love Shack to skirt his pending obscenity charge.
So PayPal cuts off and alienates a sizeable number of their customers, while some other savvy entrepreneur cuts in and grabs the business that is "too immoral" for PayPal to soil themselves with… It’s like giving away free money to another business. These sexual moralists are so shortsighted — a consequence of not having any good sex, perhaps?
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