We are as tired of writing about Facebook as you probably are of reading about them.
But they just keep making mistakes. And not the sort of mistakes about product features or markets or prices that businesses often make, especially new businesses.
No, the mistakes Facebook makes have to do with judgement and governance and maturity and respect for others and the value of customers and leadership, but most of all, trust.
The latest conflagration started when Instagram, the photo app purchased for $700 million by Facebook, announced some changes to its terms of service. A routine announcement, they thought. However, its wording suggested - once again - that Facebook management claimed the rights to everything appearing on their platforms, mandated further denial of privacy rights and, per usual, included no opt-out provision.
The company has subsequently issued a detailed explanation cum apology, claiming it was all a terrible misunderstanding and that they are very sorry for the confusion. That might be true or it might be a clever response to a situation that had spiraled out of control. Whatever.
The real issue is that Facebook continues to make decisions that outrage its customers, concern regulators, offend opinion leaders and cause all of them to assume the company is guilty until proven innocent. And spare us the keening violins of victimhood for this management team. It just keeps happening.
This company has a leadership and governance problem. Which has contributed to a brand and reputation problem. This is a service people use, but it is not a service people love, particularly, nor one that they trust. Unless changes are made at the top of the company, there will, eventually, be a final straw. The question appears to be when, not if, it lands. JL
Eliza Kern comments in GigaOm:
Instagram responded to user outcry Tuesday over the company’s updated terms of service, clarifying that it does not intend to sell a user’s photos and that users still retain all rights to their content, in an update to the terms of service originally released by the company on Monday morning. The blog post said that Instagram has heard the user complaints, and is making several clarifications:
◦The company does not plan to sell your photos: “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. We are working on updated language in the terms to make sure this is clear.”
◦The company does not plan to make your photos part of advertisements: “The language we proposed also raised question about whether your photos can be part of an advertisement. We do not have plans for anything like this and because of that we’re going to remove the language that raised the question.”
◦The company does not own your content: “Instagram users own their content and Instagram does not claim any ownership rights over your photos. Nothing about this has changed. We respect that there are creative artists and hobbyists alike that pour their heart into creating beautiful photos, and we respect that your photos are your photos. Period.”
◦Users can still set their photos to private: “Nothing has changed about the control you have over who can see your photos. If you set your photos to private, Instagram only shares your photos with the people you’ve approved to follow you.”
The company explained in the post that it understood the user confusion over the updates, and would be making these changes to better reflect how the company will use data and photos. The company emphasized that its motives for the changes were related to making advertising more useful to users and more native to the Instagram stream, but that it understood the changes weren’t interpreted that way by users, it wrote in the post:
“From the start, Instagram was created to become a business. Advertising is one of many ways that Instagram can become a self-sustaining business, but not the only one. Our intention in updating the terms was to communicate that we’d like to experiment with innovative advertising that feels appropriate on Instagram.”
The company explained that the update to the advertising language was intended to fit with its advertising strategy going forward, which seems very much like Facebook’s targeted advertising approach:
“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.”
Several blogs, including ours, pointed out Monday that the updated terms of service weren’t dramatically different from the original ones — they just clarified exactly how your images can be used by the company.
All Instagram photos are posted by default as public to the web, unless a user choses to go private, and the company has always held the right to use those photos in conjunction with advertising. The old terms stated: “you hereby agree that Instagram may place such advertising and promotions on the Instagram Services or on, about, or in conjunction with your Content. The manner, mode and extent of such advertising and promotions are subject to change without specific notice to you.”
But even if the advertising component isn’t new, it didn’t stop news outlets and many users from reacting negatively toward the company’s update on Monday. Many users declared that they were quitting Instagram and heading to Flickr or other services (a statement we might not have expected to come in 2012.)
The fact that Instagram wants to reserve the right to advertise with the content on the service makes sense — the company was purchased by Facebook for more than $700 million, and needs to prove that it can start making money. The service has more than 30 million registered users uploading more than 5 million photos per day, all without paying Instagram a cent. In an era when people are reluctant to pay for content, advertising is a predicable strategy. And as the Verge and others pointed out, presenting your photos and actions in conjunction with advertisements is not all that different from Facebook social ads that allowing advertisers to connect their content with your actions on the site.
But even if the updated terms of service were overblown by the media, Monday’s release was clearly a misjudgement on Instagram and Facebook’s part. The company didn’t fully explain what the changes meant and how your photos would be used, and people felt that their privacy would be violated by the new terms, which they have no choice to opt out of, as they do with Facebook social ads. And once users lose trust in a company, it can be hard to gain that back.
Many people are understandably wary of Facebook’s use of their data and distrustful of the service, and this incident could have killed many users’ hopes that their beloved photo app wouldn’t change from its roots after going under Facebook ownership.
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