Instagram caught on candid camera

Your sepia-toned smartphone pix are safe for now, but don't be surprised if Instagram and Facebook redefine 'sharing' -- again

Well, that happened. Earlier this week, Instagram found itself in middle of an insta-controversy, and just like that it was insta-over.
The photo sharing app, which gives iPhone and Android users the ability to make their digital pix look like '70s-era Polaroids, became insanely popular in less than two years. Just as insanely, Facebook forked over $1 billion in stock to own it. (Thanks to Facebook's boat-anchor stock price, that deal is now worth just under $800 million.)

So this week Instagram published a revised set of terms and conditions that seemed to reveal exactly why Facebook paid so much for it. To most people who read them, it appeared Instagram had decided to take the 1 billion-plus photos its users had happily uploaded for free and sell them to advertisers and others. Here's the excerpt from those terms that got everyone's panties in a twist:

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. If you are under the age of eighteen (18), or under any other applicable age of majority, you represent that at least one of your parents or legal guardians has also agreed to this provision (and the use of your name, likeness, username, and/or photos (along with any associated metadata)) on your behalf.

Not only did it sound like Instagram was planning to use your pix in advertisements, it could also be using your kids' photos as well -- no notice, no compensation, no nothing.
Imagine a photo of you hoisting a cold one next to an ad for Budweiser, for example. Or one of your naked toddler alongside a spot for Pampers. You can guess what happened next.
The response was swift and ugly. Tech bloggers jumped on them with both feet. Celebs like Anderson Cooper and the Kardashians took to Twitter to declare themselves insta-disgusted. As actor Jonah Hill put it:

At the same time, the social media apologists -- you know, the ones who agree with Zuck that "sharing is the new social norm" -- were out in full force. Some were saying, and rightly so, that when you share personal information in a public venue (like a social network) you should expect things like this to happen.
Others were saying, not quite so rightly, that all social networks operate in the same way. It's true that for services like Facebook or Twitter to work they must have the ability to make copies of your stuff, move them from one server to another, and display them on other people's screens. Otherwise we'd all just be talking to ourselves. But only Facebook (and now, briefly, Instagram) has gone the extra mile and said it can also use your stuff in ads. Flickr, Picasa, and Photobucket don't do that.

It's particularly strange Instagram even tried to do this, given the fact that a) it's now part of Facebook, and b) Facebook just got slapped by a federal court for using people's faces in ads without compensation or permission.
As the Internet descended upon Instagram's doorstep with torches and pitchforks, co-founder Kevin Systrom bid an insta-retreat, issuing the following clarification:

To be clear: it is not our intention to sell your photos. We are working on updated language in the terms to make sure this is clear.
To provide context, we envision a future where both users and brands alike may promote their photos & accounts to increase engagement and to build a more meaningful following. Let's say a business wanted to promote their account to gain more followers and Instagram was able to feature them in some way. In order to help make a more relevant and useful promotion, it would be helpful to see which of the people you follow also follow this business. In this way, some of the data you produce -- like the actions you take (eg, following the account) and your profile photo -- might show up if you are following this business.

So your photos won't be used in ads, but they might be displayed right next to ads. Everybody OK with that?
Even if Instagram didn't intend to really sell people's photos to advertisers, despite legal language suggesting just that, it still managed to create a pileup of epic proportions. As my cyber lawyer buddy Bennet Kelley of the Internet Law Center told me recently, "When people are talking about your terms of service in public, that's never a good thing."
Of course, Instagram is free, so clearly people are paying for it with something, whether it's their photos or their data. Doesn't that mean Instagram gets to do whatever it wants with them?
In a wonderfully clear and coherent essay, Internet entrepreneur Derek Powazek lays waste to the myth that getting stuff for free from a company (like a photo sharing service) means they get to do whatever they please with your stuff, or that paying a company for services you use automatically means they treat you better. He writes:

Just because you pay doesn't mean you're not the product. Cable TV companies take our money and sell us to the channels, magazines take our money and still sell ads, banks and credit cards charge us money for the service of having our money....In the real world, we routinely become "the product" even when we're already paying....
What's inherently wrong is a company changing its terms of service to screw their users. What's wrong is a company that sells your data without your consent. What's wrong is a company that scales back customer service to save a buck, leaving its customers angry and frustrated....
What matters is how companies demonstrate their respect for their customers. We should hold their feet to the fire when they demonstrate a lack of respect.

Whether Instagram -- and really, Facebook -- truly respect their customers remains to be seen. But we've certainly managed to get their insta-attention.