Instagram users annoyed with new rules, carried out their threats to dump the popular photo-sharing app. The app acquired by Facebook Inc (NASDAQ:FB) earlier this year for $1 billion, has lost nearly a quarter of its daily active users owing to the debacle.
“[We are] pretty sure the decline in Instagram users was due to the terms of service announcement” on Dec. 17, AppData told The Post.
As per the data, Instagram’s active daily users had fallen to 12.4 million as of yesterday, from the peak of 16.4 million the week it rolled out its policy change, according to The New York Post. The number is equal to a 25% drop, which would mean a $250 million loss for Facebook. The company changed its service terms last week to incorporate advertising. The new terms allowed the company to sell user photos for advertising and promotions “without any compensation to you.” It is impossible to tell if the new terms of service put in place by Instagram came from inside the company, from Facebook Inc (NASDAQ:FB), or was the product of a dialogue between the two companies.
The move caught mass resentment, with celebrities including Kim Kardashian and Justin Bieber expressing outrage. Though Bieber withdrew his threat to leave, but as of yesterday Kardashian, the most followed user, hadn’t posted a picture of herself since the debacle.
David Fewer, director of the Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic at the University of Ottawa.“Those online service providers are asking for something in return,”
- You could star in an advertisement — without your knowledge. A section of the new terms of service, titled “Rights,” notes that Instagram will also be able to use your photographs and identity in advertisements. “You agree that a business or other entity may pay us to display your username, likeness, photos (along with any associated metadata), and/or actions you take, in connection with paid or sponsored content or promotions, without any compensation to you,” the new terms say. This means that photographs uploaded to Instagram could end up in an advertisement on the service or on Facebook. In addition, someone who doesn’t use Instagram could end up in an advertisement if they have their photograph snapped and shared on the service by a friend. Facebook already runs ads that make use of people’s activity on its site. Marc Rotenberg, executive director of the Electronic Privacy Information Center, an advocacy group in Washington, said that the use of a person’s likeness in ads could run into some state laws protecting people’s privacy. Mr. Rotenberg said. “Most states have laws that limit the use of a person’s ‘name or likeness’ for commercial purposes without consent,” The legal purpose is to allow people to obtain the commercial value of their images and endorsements, which is a big issue for celebrities and others, but also a reasonable concern for Facebook users whose images are used by Facebook to encourage friends to buy products and services.”
- Underage users are not exempt. Athough Instagram says people must be at least 13 years old to sign up for the service, the new terms note that if a teenager signs up, they are agreeing that a parent or guardian is aware that their image, username and photos can also be used in ads.
- Ads may not be labeled as ads. In another section of the updated terms, the company says ads will not necessarily be labeled as ads. “You acknowledge that we may not always identify paid services, sponsored content, or commercial communications as such,” the company wrote.
No wonder Instagram users revolted and Instagram backedoff. The changes, which were to go into effect Jan. 16, 2013, will not apply to pictures shared before that date.
It's now back to the drawing board for Instagram. I have a feeling that Instagram will offer premium photo posts for users who want to promote a particular picture.