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Should We Really Be Outraged by Instagram's Privacy Policy Change?

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Much like Facebook, Instagram eventually had to monetize its business.

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MINYANVILLE ORIGINAL Has the backlash to the backlash begun? After Instagram announced a loosening of its privacy policies, it, well, instantly drew the ire of netizens, with many users expressing outrage that the company might sell their pictures to advertisers without their express consent.

Here's the portion of Instagram's new terms of service that has gotten users in a tizzy:
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.

Even celebrities got into the act, with Kim Kardashian and Pink among those tweeting their displeasure at the photo-sharing app.





Many users also vowed to quit the service and sign up for other photo-sharing alternatives, including Yahoo's (NASDAQ:YHOO) newly-released Flickr app.

However, soon after the first wave of anger over Instagram's policy changes subsided, some contrarian opinions began to emerge. The gist of what several online commentators said was: Why are we surprised when a for-profit business does something that enables itself to earn money?

Sam Biddle of Gizmodo writes:
What none of these hair-pulling photo-sharing apocalypse-moaners neglect to mention is that Instagram's a business. A business that charges nothing for something that millions of people use constantly. In that sense, it's a crazy business. It's also a business that Facebook bought for one billion dollars. Facebook isn't the World Wildlife Fund or a soup kitchen-it's also a business, and one with very angry shareholders who expect to see a return on Facebook's insanely insane purchase. Ergo, Instagram needs to start making money.

Launched on the Apple (NASDAQ:AAPL) iOS platform in October 2010, Instagram quickly became a phenomenon and gained 1 million registered users in two months. It was later released to Android (NASDAQ:GOOG) in April 2012. The company had 100 million active users as of September. When a company like Instagram becomes a business behemoth without a monetization plan in place, such change should be expected. Indeed, Instagram parent company Facebook (NASDAQ:FB) basically faced the same problem. As a free social network, Facebook needed ways to monetize its services and as such recently started allowing advertisers "to target ads at users based on the email address and phone number they list on their profiles, or based on their surfing habits on other sites," noted the Wall Street Journal.
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