Paypal blocks VPN services but not quite

Late last week leading online payment processor Paypal blocked the payment account of SmartDNS and VPN service Unotelly.

Unotelly is a service known to target users who wish to circumvent geo-restrictions and access content that would be otherwise unavailable in their country.

Incorrect VPN wide blocking claims

While many news outlets have claimed Paypal is starting to clamp down on VPN and SmartDNS services, this is not technically true.

Paypal’s terms and conditions state that the service can not be used to take payment for services that allow the bypassing of copyright restrictions and although Unotelly has fallen foul of these conditions it is not a blanket ban on VPN and SmartDNS services, although the latter may find itself more affected in future.

Unotelly has been specifically marketing their service as a way to circumvent region restrictions and access TV content. Even the service name points towards this usage with “telly” being a reference to TV.

VPN services from providers such as IPVanish are not intended to be used to bypass geo-restriction and are instead aimed at encrypting and protecting a user’s internet connection.

While it is completely true that a service like IPVanish can help you watch other region’s Netflix content, access Premiership Football via sites such as PremierLeaguePass and watch services like BBC iPlayer anywhere in the world, it is not their intended purpose.

Marketing the cause of the blockade

VPN services often market their offerings as a way to watch TV from other locations in the world and those that do are likely to be hit by the Paypal account limiting that has been seen in the case of Unotelly.

Unotelly has taken swift action to update their website which was available as recently as January moving away from a blatant TV geo-restriction bypassing service to a more generic VPN service site.

Unotelly Pre Paypal Block

Unotelly Pre Paypal Block

Unotelly Post Paypal Block

Unotelly Post Paypal Block

However, VPN services that essentially enable TV content access from around the world but do not market their service for this purpose are highly unlikely to be affected even though TV access is possible.

Unotelly announced the severing of the payment service on the 4th February urging users to change to alternative forms of payment. How the block will affect customer sign-up to the Unotelly service will be left to be seen and with Paypal holding a somewhat monopoly on online payments it may leave many users without a viable alternative to make payment.

Many tech-savvy users will now move to anonymous payment systems such as Bitcoin or use easier methods like direct payment via credit card.

What is most interesting about the Paypal block is how they are applying their own terms and conditions over the laws of certain countries. In Australia for example, it is not illegal to use a VPN to bypass geo-restrictions and access other countries content which is made clear on the current Australian Prime Minister’s website.

Australian VPN

Prime Minister Malcolm Turnbull’s website.

The development will come as a blow to Unotelly but with plenty of other VPN services accepting Paypal such as IPVanish, StrongVPN and ExpressVPN who as a by-product of their service will allow access to TV services but are not marketed as such meaning there is no reason to despair.

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