Instagram Reverts to Old Ad Policy Amid Outcry

by Christopher Freeburn | December 21, 2012 10:27 am

[1]Facebook‘s (NASDAQ:FB[2]) Instagram is beating a hasty retreat after users slammed an updated terms-of-service agreement issued by the company earlier this week[3].

Under the new agreement, Instagram claimed the right to share with Facebook advertisers users’ data and photos without their permission or paying them compensation. After an uproar, Instagram announced on Thursday that it was abandoning the new advertising terms and would return to its previous agreement, The New York Times noted. The prior terms had been in place since 2010.

The new terms provoked a harsh reaction from users, with some vowing leaving the service. Earlier this week, Instagram said the clause in the new agreement had been misunderstood.

In the latest message posted on the company’s blog, Instagram co-founder Keven Systrom said the company would continue to work on expanding its advertising products and would explain those products once they had been completed.

Analysts noted that Instagram, a service that’s free to users, is looking for ways to generate ad revenue[4]. Facebook purchased Instagram earlier this year for $735 million.

Shares of Facebook fell more than 1% in Friday morning trading.

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