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.
This caused uproar with users with many taking to Twitter to vent their anger. Most were insisting they would be deleting their accounts before the 16th January deadline (although lets face it, nobody will actually do this).
But lets take a proper look at this new Term of Service. What does it really mean?
Well a term similar to this has always been in Instagram's Terms of Service, they've always been able to use our content in pretty much any way they want to.
What this new term most certainly does not mean is that Instagram can sell your photos to other companies or people. What is does mean is that companies can use your content in paid advertisements on Instagram and Facebook in exactly the same way they do now on Facebook.
For example, an advert might say "Look at these awesome pictures of our shop, taken by person x" or in the same style as sponsored stories on Facebook an advert might say "Person x follows us, you should too".
In no way will Instagram be selling your content to random people. In no way are your pictures going to be appearing in newspaper adverts or on billboards.
Instagram certainly messed up here, not by having this term of service but by not explaining exactly what it means.
Update: Instagram today released a new blog post where they reiterated the fact that they're not going to be selling your photos. Here's what they said:
it was interpreted by many that we were going to sell your photos to others without any compensation. This is not true and it is our mistake that this language is confusing. To be clear: it is not our intention to sell your photos.
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.