Instagram : follow your dreams, CANCELLED



The great interweb is in an almighty furore over Instagram’s changes in terms and conditions (thank you NY Times) which allow them to use new user content for advertising (and possibly, licensing) and which they tried to pass off a way to fight content spam.  

Many are laughing at the “naive users” who just should not post content if they do not want it abused, but I think they are missing the point : Instagram is violating an implicit social contract with its users in the latest example in a long list of “bait and switch strategies” applied by community centric networks.

From social profiling to content appropriation

We’ve been educated by our experience of the social web to understand that our data does not belong to us anymore (the now cliche meme “you are the product”) and that said data can be used to profile us and deliver targeted advertising or offers; we’ve all learned to accept that.  Alexis Madrigal at the Atlantic is wondering it is time to get “back to paid“.  For those with less cash and less propensity to pay, we accept that we are being extensively profiled, however stealthily, so that free services can become sustainable by effectively monetizing the great communities they create through “in context” advertising or through premium strategies.  

Instagram is breaking this mould in its latest move by not only appropriating content (that is not new) but by allowing itself to use and monetize our content in apparently any way it sees fit, in particular by using your content or your image in advertisements with any third-party: 

  1. “you hereby grant to Instagram a non-exclusive, fully paid and royalty-free, transferable, sub-licensable, worldwide license to use the Content that you post on or through the Service”
  2. +
  3. “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”

Not that unlike on Flickr it does not appear that the purpose for which you license the content to Instagram is limited to promoting the use of Instagram or Facebook.  Flickr ostensibly limits the purpose of the license for use on the Yahoo Network or the promotion of Yahoo services.

In the process, Instagram is breaking trust and tearing up the implicit social contract we all had with the service.  No wonder the community is erupting.  They’re not the only ones who are abusing our trust though.

LinkedIn : your profile as a landing page

I always thought of LinkedIn as a simple place to keep my bio up-to-date and get a stable URL that I could just point people to.  I never had an issue with a clean freemium model where I knew my data would be peddled to premium users who need to recruit or develop their business.

LinkedIn, no doubt suffering from poor engagement metrics outside of its core community of premium subscribers, recently decided that my profile could in fact be used as a nifty landing page to force sign-in or sign-up.  In a classic example of bait-and-switch, it is using me for its own advertising (my face becomes an ad) and using its core service (my profile) as a conversion tool.  What I understood to be a core free service is now a user acquisition tool; walls are being erected.

facebook : we own all ur loginz

I understand why Wall Street is maniacally focused on making sure facebook can monetize its ad inventory, but I am patiently waiting for the real bait-and-switch from these guys.  Once facebook login is deeply embedded into every social service and the company effectively becomes the identity API for the world, who’s really going to be surprised when they start monetizing the identity calls ?  Every startup that is today building on the social graph must know that some day, facebook will unleash its real monetization power by monetizing access to user data.  Don’t act surprised when they do.

“We love our users”

In the world of innovation I love that we champion “disruptive entrepreneurs” who want to “change the world”.  We’re so far out there in assuming there is something inherently ethical or moral about beating the incumbents, putting the user first, building “awesome” product.  But you know what : there is nothing inherently moral or ethical about tech or startups.  There are only choices you make.  When companies raise a huge valuations or go public for $100BN, they are putting themselves on an inescapable path of margin maximization, and pretty soon these lofty goals of user empowerment get replaced by singular focus on ARPU maximization, users be damned.

No better than the record labels

If Instagram has suddenly become the new Getty Images, it did so by stealth.  When the founders decided to take money they did not need or sell out for $1BN, they were complicit in that action.  So before we go lambast the big corporations like Universal for how they treat their artists, I suggest we take a hard look in the mirror.  If you have a mission to “make the world a better place” you may want to consider building smaller, sustainable companies that can actually continue to deliver real value to their users instead of being totally optimized for shareholder value.  

Founder vision no more

I doubt that Kevin Systrom was ecastic about the changes in terms.  He’s nowhere to be seen around this announcement and he certainly did not sign the now infamous blog post.  His last tweet is about @Mailbox.

Welcome to the faceless, nameless corporation called Instagram.  We hope you enjoy our new Terms of Service.

follow your dreamsBanksy

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  • http://startupcfo.ca/ Mark MacLeod

    Saw the ToS but should have read them clearly. My big issue here is separation of personal vs. professional life. I don’t really want personal, family photos showing up in commercial works. Will very likely cancel my account.

    If some of these changes you foreshadow come to pass, especially monetizing identity, we will likely see many services and apps die off. Only the most engaging ones will have enough user loyalty and scale to absorb or pass on the cost.

    There’s no free lunch and free apps always come with a price.

  • Ronin_Jim

    The Twitstagram handbags was a bit abstract, ordinary users would find it pretty tough to place a dollar value on their usage data. But appropriating commercial ownership of images is another thing entirely. Photos like any intellectual property have a commercial value, Instagram know this, that’s why they’ve made this landgrab. But whereas Getty pays royalties to the license holder on the basis of usage, Instagram has just unilaterally claimed ownership of all that content. That’s the difference.

    The really stupid thing is they need not have played it this way. With two simple changes they could have made themselves the hero of every wanna be Robert Capa using them. Firstly provide an op-out, and secondly, split the royalties. Everyone wins, both Instragram and its users immediately create a new and sustainable revenue stream.

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  • http://twitter.com/jontetz Jon Tetzlaff

    Deleted my Instagram account yesterday. Facebook is lucky that I manage a few different pages on their otherwise that would be deleted also.

  • http://twitter.com/rangerj Julian Ranger

    The problem is that not enough companies are prepared to take the monetise route and make a virtue of privacy. At SocialSafe (where you can download your Instagram photos before deleting them) we give 2 months free and then charge, albeit a small amount – however, we make sure we never see your data and that all users know everything is 100% private. I envisage this being more common as we move forwards.

  • http://chrisarsenault.wordpress.com/ Chrisarsenault

    Great post Fred, it forced me to actually read the revised TOS. I do understand that nothing free is free. Monetization is required for all products and services, but models differ in masses. My main concern about Instagram’s monetization model related to the potential negative impact on my “family” Going forward I will NOT post any family related pictures. But my understanding is that even if I deleted some pictures now, they will still have the right to use them! That freaks me out.

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  • http://twitter.com/eliasmoubayed Elias Moubayed

    Really enjoyed your post Fred. If I didn’t get so much value from Linkedin I’d be less forgiving if they were to use my profile. As far as Instagram goes I have now reached the limit of my threshhold for trying to understand where and how my data is used and privacy policies in general. I hope other users start to gravitate in this direction. I now expect a privacy policy, by default to be, ‘no one gets to see my data unless I explicitly allow it’. As this isn’t about to happen I have simply deleted my Instagram account. Seems extreme but the sense of liberation is even better, I suspect others will or have already done the same – the pressure to drive revenue at Facebook will definitely kill that golden goose – bring it on.

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