U.S. companies are pulling the plug on WikiLeaks and its activists, raising tough questions about cyberspace as a celebrated free speech forum and about government pressure.

MasterCard, Visa Inc and eBay Inc unit PayPal have severed ties with the website, cutting into the funding lifeline of the organization that has published secret government cables embarrassing to Washington.

Bookseller Amazon.com Inc also stopped hosting WikiLeaks' website.

While WikiLeaks found a new host and continues to publish, DataCell, the Icelandic company that processes its donations, said a large portion of funding for the shoe-string operation has been cut off.

None of those companies want to be singled out for helping undermine American national security, said Jeff Chester, the executive director of the Center for Digital Democracy in Washington, an organization that aims to promote democratic expression and human rights on the Internet. It shows a lack of independence and an attempt to curry favor.

Some are calling it corporate censorship, and comments from PayPal and a software provider added to concerns about the role played by Washington.

Companies such as credit card providers and Amazon are not obliged to provide services beyond the terms of their WikiLeaks contract, legal experts say. While contract terms are private, experts said the companies were likely well within their rights.

The private sector can do things and get away with things that would be unconstitutional if done by the government, said Lawrence Soley, a Marquette University professor of communications. I believe that corporate censorship is as much, if not more, of a danger to free speech than the government, he said.

CONFIDENTIAL CABLES

WikiLeaks began publishing confidential U.S. diplomatic cables last month, enraging Washington with revelations that have strained relations with allies around the world.

MasterCard, Visa and Amazon.com said they cut ties to WikiLeaks because of violations of their terms of use, and Amazon specifically ruled out pressure by the U.S. government.

Other companies, however, pointed to government involvement.

Tableau Software of Seattle said on its website that it stopped providing its graphics software to WikiLeaks in response to a public request by Senator Joe Lieberman, who chairs the Senate Homeland Security Committee.

Lieberman told the MSNBC television station last week that we have to put pressure on any companies supporting WikiLeaks and he cited the example of Amazon cutting off its servers.

A PayPal executive said on Wednesday that WikiLeaks violated the acceptable use policy of its PayPal online payment service unit, but he noted it was brought to the company's attention by Washington.

On November 27th, the State Department, the U.S. government basically, wrote a letter saying that the WikiLeaks activities were deemed illegal in the United States and as a result our policy group had to make the decision of suspending the account, said Osama Bedier, eBay vice president of platform, speaking at an Internet conference.

WikiLeaks activists have launched cyber attacks on the website of companies that have severed ties to the renegade publisher.

Hackers have communicated through Facebook and Twitter, drawing two of the fastest growing Internet companies into the controversy. Both companies have closed down accounts used by the hackers, although WikiLeaks' page on Facebook remains up.

Legal experts said what is being called a data war is a reminder that the Internet is not a public domain.

Private companies such as Internet service providers are not common carriers like phone companies, which have a general duty to provide service to everyone because of their monopoly positions.

'WINK OR RAISED EYEBROW'

Legal specialists voiced concerns about the government's ability to lean on companies such as MasterCard, Visa and PayPal, which handle the bulk of donations to an Internet-based operation such as WikiLeaks.

Government censorship by a wink or raised eyebrow can be as serious as outright prohibitions. Particularly where a critical facility is at issue, said Diane Zimmerman, a professor at New York University School of Law.

But Zimmerman and others questioned whether a request, even if from the White House, amounted to censorship if it is not backed by a threat.

Chester, of the Center for Digital Democracy, said the risks of angering Washington can be high. Companies often need regulatory approval for mergers and laws regarding privacy, online advertising, sales tax and Internet access can have a big effect on the companies.

Government censorship is still worse because the government has the ability to criminally prosecute you and take away your freedom, said David Hudson of the First Amendment Center in Nashville, Tennessee. The looming issue is whether there is any push to prosecute (WikiLeaks) under the Espionage Act. That is the million-dollar question.

(Editing by Vicki Allen)

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