On January 16, 2013, all your pictures posted on Instagram will be theirs to sell without payment or notification to you. Buyers can then use your photos for ads, positive or negative ones, without any say on your part. The only way to opt out is for you to delete your account before January 16.
That’s what Instagram’s new Terms of service seem to be saying. Before the change, Instagram had the right to display your pictures and do pretty much whatever it wanted to as required to run a safe hosting business. The changed terms of service adds the clause that it can now also offer your pictures to commercial buyers (to do as they want with it) without first asking for your permission or sharing revenues with you, as Flickr does.
Some or all of the Service may be supported by advertising revenue. To help us deliver interesting paid or sponsored content or promotions, 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.
Back in April, Facebook bought Instagram for an astounding $1 Billion. Guess, the chickens have come home to roost.
Kevin Systrom, co-founder of Instagram, quickly blogged a rebuttal
Advertising on Instagram From the start, Instagram was created to become a business. Advertising is one of many ways that Instagram can become a self-sustaining business, but not the only one. Our intention in updating the terms was to communicate that we’d like to experiment with innovative advertising that feels appropriate on Instagram. Instead it was interpreted by many that we were going to sell your photos to others without any compensation. This is not true and it is our mistake that this language is confusing. To be clear: it is not our intention to sell your photos. We are working on updated language in the terms to make sure this is clear.
To provide context, we envision a future where both users and brands alike may promote their photos & accounts to increase engagement and to build a more meaningful following. Let’s say a business wanted to promote their account to gain more followers and Instagram was able to feature them in some way. In order to help make a more relevant and useful promotion, it would be helpful to see which of the people you follow also follow this business. In this way, some of the data you produce — like the actions you take (eg, following the account) and your profile photo — might show up if you are following this business.
The language we proposed also raised question about whether your photos can be part of an advertisement. We do not have plans for anything like this and because of that we’re going to remove the language that raised the question. Our main goal is to avoid things like advertising banners you see in other apps that would hurt the Instagram user experience. Instead, we want to create meaningful ways to help you discover new and interesting accounts and content while building a self-sustaining business at the same time.