Facebook Incites Backlash With Changes in Instagram Terms

Dec. 19 (Bloomberg) -- Bloomberg's Jon Erlichman reports on the backlash against Instagram as the photo-sharing site announced new terms of use that would allow companies to access user content for advertising purposes. He speaks on Bloomberg Television's "In The Loop."

Facebook Inc. (FB)’s policy changes to its Instagram photo-sharing site has drawn criticism from consumers, photographers and privacy advocates who said the update forces them to cede control over content.

Instagram unveiled a new privacy policy and terms of service on Dec. 17 that will give advertisers more flexibility in using photos, user names and likenesses in ads. After a backlash that resulted in thousands of complaints on Facebook, Instagram co-founder Kevin Systrom said yesterday that the new terms will remove language suggesting that users’ photos could appear in advertisements.

Facebook, the world’s largest social network with more than 1 billion users, is seeking ways to eke sales from the rising tide of information users post to their profile pages. That has put the company at odds with consumers -- from the rank and file to celebrities such as LeBron James -- who oppose having their images woven into marketing messages.

“There was a lot of backlash,” Parker Higgins, an activist at the Electronic Frontier Foundation, said in an interview yesterday. “There are major problems with the policy. It’s not a great position to be in, for a social network to be distrusted by its users.”

Source: Bloomberg

Instagram unveiled a new privacy policy and terms of service on Dec. 17 that will give advertisers more flexibility in using photos, user names and likenesses in ads. Close

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Source: Bloomberg

Instagram unveiled a new privacy policy and terms of service on Dec. 17 that will give advertisers more flexibility in using photos, user names and likenesses in ads.

Instagram, which Facebook’s Chief Executive Officer Mark Zuckerberg agreed to buy earlier this year for about $1 billion in cash and stock, has more than 100 million users. Popular with teens and young adults, the service lets users tweak and upload photos for sharing over the Web.

Digital Goldmine

Users in droves responded to the proposed changes by threatening to leave before the new terms were to take effect on Jan. 16. The wording in the updated policy also applies to users as young as 13, raising concerns over teenagers’ privacy, according to Jeffrey Chester, executive director for the Center for Digital Democracy.

Facebook “sees teens as a digital goldmine,” Chester said. “We will be pressing the Federal Trade Commission to issue policies to protect teen privacy.”

Instagram’s new terms propose that users must agree to let an advertiser “display your user name, likeness, photos” in ads or sponsored content without paying the users, or asking for their permission. Users younger than 18 must also acknowledge that at least one parent or guardian has also agreed to content being used in marketing. The changes are aimed at protecting members while preventing abuse, Instagram said in a blog.

Zuckerberg has had to backtrack on service changes in the past. In 2007, he apologized after users complained that the social-networking site’s Beacon advertising program violated their privacy. The feature tracked what users buy online and shared the information with their friends.

Pushing Boundaries

In the updated policy document, Instagram also said it may not always identify paid services or sponsored content. The company said it doesn’t claim ownership of any content on the service, though some businesses may pay to display users’ names, likeness or photos in connection with sponsored content.

“Our updated privacy policy helps Instagram function more easily as part of Facebook by being able to share info between the two groups,” the company said. “This means we can do things like fight spam more effectively, detect system and reliability problems more quickly, and build better features for everyone by understanding how Instagram is used.”

The controversial wording may be scrapped altogether, according to Brian Wieser, an analyst at Pivotal Research Group.

“One thing Facebook has done pretty consistently is pushed the boundaries of what its users are comfortable with,” Wieser said in an interview. “And it frequently backed off.”

To contact the reporters on this story: Olga Kharif in Portland at okharif@bloomberg.net; Brian Womack in San Francisco at bwomack1@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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