Instagram asserts the right to sell your photos

You are not the customer, you are the product.

Instagram, the photo-oriented social network which was purchased by Facebook for $700m in cash and shares last April, has revealed the new terms of service which it will be implementing from January next year, and they mark a new direction out for the company.

The passage which is getting all the attention online is the second section under the heading "Rights":

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.

Instagram is not just taking adverts, as many predicted would happen once the Facebook acquisition was complete; it is also claiming the right to sell use of your photos to businesses to make ads with.

That's a pretty big step up from previous practice, but is similar in tone to what Facebook has been doing with their social marketing for a while now. As Nick Bergus learned, Facebook's method isn't without hitches. When he posted a jokey link to a 55-gallon barrel of "Passion"-brand lubricant, it was adopted by Facebook into an advert which was then shown to all his friends.

The problem with the Instagram extension of this concept is two-fold. Firstly, just as with the Bergus screw-up, recontextualising a picture as an advert changes what it says, frequently for the worse. But secondly, it feels like a Rubicon has been crossed if the "user-generated content" being used is undoubtedly a creative work – which even the blandest Instagram photos are – and if money changes hands without including the actual creator of that work.

In addition, of course, there's the idiot factor: People seem to forget how public Instagram is, and finding themselves included on a national poster campaign could be a nasty way to find that out.

As ever with this sort of change, there is likely to be a disconnect between the rights the ToS claim, and Instagram's actual plans. I would be surprised, for instance, if they intended to sell user images for use as generic stock photos, rather than for Instagram-specific ad campaigns. But I would also be surprised if these terms didn't give them the right to do that if they so desired.

Oh, and you can't actually reject these terms. If you're still using the service on 16 January, you are deemed to have accepted them.

It seems almost too perfect that in the same week that Instagram launches an anti-user change, Flickr – remember Flickr? – has released a new iPhone app which brings a host of Instagram-like changes to the service, including far quicker access to the camera, better Twitter integration and, yes, filters. A number of people are suggesting switching to (or back to) the service as a result.

The best thing about this switch is that it isn't just kicking the can down the road. After all, the reason Instagram included these changes is because it has to make money. The Atlantic's Alexis Madrigal makes the point:

[C]ompanies have to sell themselves because they do not have a sustainable business. And when they're sold, they either A) get shut down or B) become part of an advertising machine, like Facebook's.

Truly, the only way to get around the privacy problems inherent in advertising-supported social networks is to pay for services that we value. It's amazing what power we gain in becoming paying customers instead of the product being sold.

Flickr, by contrast, does have a paid service, and has for years. There's no guarantee it won't take the quick buck – but it has a business model which involves treating users as the customer, not the product. And that's a nice change from the norm, these days.


Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.