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Amazon Stops Processing Payments For Crowdfunding Platform For Creative Commons Books

from the weird dept

So this is a bit strange. Unglue.it is a cool crowdfunding platform that focuses on raising money for authors/rightsholders so that they'll release an edition of their books under a Creative Commons license. We've seen a few similar offerings, but Unglue.it seemed really interesting (and to be getting some attention/traction). Basically, they would work with rightsholders, to find out at what price they'd be willing to put their works out under a Creative Commons license, and then try to crowdfund that amount. Neat idea. However, as Jack Allnutt alerts us, despite having already been processing payments for Unglue.it, Amazon has cut the service off, with a bizarre claim about how they don't want to work with any new crowdfunding platforms:
Amazon Payments has informed us that they will no longer process pledge payments for Unglue.it, forcing us to suspend all active ungluing campaigns. According to a Senior Account Manager at Amazon, Amazon has decided against “boarding fresh crowdfunding accounts at this time”. Amazon has been providing payment services for Unglue.it, as it does for the popular crowdfunding site Kickstarter.
Of course, that statement doesn't make much sense, given that it was already processing payments for Unglue.it. In fact, part of this news was that Amazon is requiring Unglue.it to void all payments for existing campaigns (i.e., those not yet funded). So the idea that this is about not "boarding fresh crowdfunding accounts" doesn't make much sense. Amazon has been the only choice for payments on Kickstarter since the beginning, and that seems to have gone well, so it's odd that they're now cutting off others (and, of course, opens up Amazon to wild conspiracy theories). I contacted Amazon to get their side of the story, and they provided the following comment:
We support a wide variety of businesses, but we have regulatory obligations as a licensed money services business for how we operate. Unfortunately, Unglue.it’s model is not the same as some other crowdfunding services and at this time does not allow us to meet those obligations.
That statement makes this all the more... confusing. They're clearly implying that there are regulatory issues preventing them from supporting Unglue.it, though I'm not sure I can think of what the concern here might be. There have been some regulatory issues around equity funding via crowdfunding, but that doesn't seem to be an issue here. If they're just working out deals for licensing books... I'm at a complete loss.

Filed Under: crowdfunding, payment processing
Companies: amazon, kickstarter, unglue.it

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  1. identicon
    Peter, 24 Aug 2012 @ 9:01am


    The real reason I think is that Amazon (and PayPal) were warned by certain government officials that they might be allowing an online activity which isn't regulated (meaning taxed) properly right now.

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