Instagram makes about-face on ads

New York TimesDecember 21, 2012 

— In the aftermath of the uproar over changes to Instagram’s privacy policy and terms of service this week, the company did an about-face late Thursday.

In a blog post on the company’s site, Kevin Systrom, Instagram’s co-founder, said that where advertising was concerned, the company would revert to its previous terms of service, which have been in effect since October 2010.

“Rather than obtain permission from you to introduce possible advertising products we have not yet developed,” he wrote, “we are going to take the time to complete our plans, and then come back to our users and explain how we would like for our advertising business to work.”

Users had been particularly concerned by a clause in Instagram’s policy introduced on Monday that suggested Instagram would share users’ data – like their favorite places, bands, restaurants and hobbies – with Facebook and its advertisers to better target ads.

They also took issue with an update to the company’s terms of service that suggested users’ photos could be used in advertisements, without compensation and even without their knowledge.

Following a reaction that included customers defecting to other services, Systrom told Instagram users Tuesday that the new policy had been misinterpreted.

“It is our mistake that this language is confusing,” he wrote, and he promised an updated agreement.

That statement apparently was not enough. With more people leaving the service, the company, which Facebook bought for $735 million this year, reacted again by returning to the old rules.

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