Instagram is updating its terms to reflect its new ownership by Facebook, just as Facebook recently amended its data use policy to allow data to be shared among its affiliates. Instagram notes that nothing has changed about who can see a user’s photos, but explains:
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.
This addresses an issue that came up with Facebook’s Sponsored Stories product. The company was recently faced with a class action suit where users claimed they deserved compensation for having their name and photos included in ads. Facebook agreed to a $20-million settlement, which includes a cash payment of up to $10 to Facebook users who objected to this use of their information. It continues to use people’s names and images along with Sponsored Stories.
Instagram may offer similar units in the future. An advertiser might pay to promote stories about users following their brand or liking one of their photos. There might also be a way in the future for advertisers to promote user-generated photos to their friends, for example including a Like or follow button to help companies build an audience.
Related article: How Facebook could monetize Instagram