O Noes, the Instagram Sky Is Falling...

[thorfinn]

O Noes, the Instagram Sky Is Falling...

So, the latest buzz about the traps is that Instagram is about add this (text from the iOS app) to it's Terms of Service :

"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

Comments

[damien_wise]

The whole situation boils down to this: if you are not paying for the service, you are not the customer.

These days, it looks more like: if you're not the customer, you're the product.
That is, places like Facebook and LinkedInLeakedIn are more than happy for you to enter your personal information, your likes and dislikes, who and what gets your attention, and professional history, because it's all a marketable commodity, and there are many, many dataminers, governments, and advertisers who're willing to pay handsomely for information that lets them track or target you more effectively.

Instagram, like FaceBorg, Twitter, and Pinterest, do some pretty fucked-up things to creative rights and ownership to skirt copyright. In effect, anything you link to through those dubious "services" is owned by them. Not to the letter of the law, but in effect, you give them all the rights and benefits that normally come with ownership, without them having pair for it or needing to claim exclusive ownership. Short version: they can do what they want with your stuff. Pinterest takes things a step further -- they graciously let you add their name (a powerful thing in a world where every token is searchable), and a "no pin" line of code to every single bleedin' page you create if you want to protect your content from their rort. It's like putting a bunch of stickers on the front door of your home, each personally addressed to every robber and con-man in the neighbourhood and imploring them not to break in and rip-off your valuables.

In the photo-sharing sector that Instagram is dominating, don't forget Flickr. Although owned by once-giants Yahoo!, Flickr has a good track record for user rights. In particular, it's heartening to see how easy they make it to apply Creative Commons rights to photos. And, I've heard of a few stories of casual photographers having their art noticed on Flickr and getting approached for publication as book-covers or ads. Flickr has credability that instagram lacks...pity is's losing to the hype and risks going dormant.

Last place I worked at hit the happy balance with the Freemium business model -- provide a useful, feature-rich, $0 product for home and personal use, and charge $99 to businesses and power-users who want all the bells'n'whistles. They're taking-on Adobe and beating them in the realm of PDF conversion and editing, have an active and self-sustaining user community, and make enough money to keep expanding throughout the GFC and pay their staff well. It works, and is commercially successful.

I like your listing of User Pays > Freemium > Open Source Self Supported > Ad Supported, and the analysis that follows...very well thought-out!

[thorfinn]

Flickr suffers from the Yahoo problem all over - they just haven't kept pace with the modern web and mobile devices. They could have, quite easily, they just haven't. Classic "incumbent" problem - they don't even understand what the new challengers (who have long since run way past where they are) are doing, let alone keep pace with them.

[damien_wise]

So true!
Standing still in such a fast-moving/competitive industry is doom. Flickr was quite good about 10 years ago...but apart from some very minor UI tweaks they haven't grown/improved it since. Yahoo's other main products were search and web-mail, so I don't think they'll regain that lost ground. I understand they were something of a "Web Portal", back when that was the thing to be. *scratches head*
I raised Flickr as an example because they had one of the largest photo-libraries in the world at one stage. They used a freemium business model, and (importantly to me) respected rights of users/creators. No reason why that combination isn't a good foundation for a business model.

[thorfinn]

Oh, definitely. And yes, yahoo was basically the first big "web portal", when the web was small enough that was actually possible to browse a categorised tree of websites and get somewhere useful. (Heck, I still have my printed copy of The Internet Yellow Pages which has a very tiny number of websites in it and a lot of other long obsoleted Internet resource protocols.) Those days are long long gone, by more than a decade. Honestly, I hope their new CEO does some serious culture change work - they need it, or they're going to be dead and gone soon, not just a bit dated.

As for freemium + good rights support, most definitely a viable business model. Vimeo is doing that today in the video space, and doing a very good job of keeping pace with the modern web and mobile.