Instagram Nixes Sponsored Story-Like Ad Product … For Now

By Justin Lafferty 

Instagram, the Facebook-owned photo-sharing social network, caused a stir throughout the Internet this week when the company altered its terms of use to foretell of an advertising service similar to Facebook’s sponsored stories. Many people mistakenly believed that Instagram would sell photos without any notice or benefit to users. After all of the confusion, Instagram decided to revert the advertising portion of its terms of use to original 2010 status.

Earlier this week, Instagram changed its terms of use to include the fact that users’ names, photos, and likenesses can be used in advertising, without notice or compensation. The ads created by Instagram would’ve likely been somewhat like Facebook’s sponsored stories product.

Here is the passage that got several Instagrammers up in arms, fearing that their photos could be sold:

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 user name, 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.

On Thursday, the co-founder of Instagram, Kevin Systrom, announced in a blog post that the company has done an about-face on that section until a more refined product can be ready:

The concerns we heard about from you the most focused on advertising, and what our changes might mean for you and your photos. There was confusion and real concern about what our possible advertising products could look like and how they would work.

Because of the feedback we have heard from you, we are reverting this advertising section to the original version that has been in effect since we launched the service in October 2010. You can see the updated terms here.

Going forward, rather than obtain permission from you to introduce possible advertising products we have not yet developed, 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.

You also had deep concerns about whether under our new terms, Instagram had any plans to sell your content. I want to be really clear: Instagram has no intention of selling your photos, and we never did. We don’t own your photos – you do.

While the advertising portion of Instagram’s terms of us will be reverted back to its original state, the rest of the document will become official Jan. 19.

Readers: Are you happy that Instagram made this decision?