Instagram sheds more than half its daily users since terms of service controversy, new report contends


posted Tuesday, January 15, 2013 at 5:10 PM EDT


The fallout from Instagram's terms of service controversy last month could be worse than expected, a new report contends. According to AppStats, a statistics tool for Facebook applications, Facebook's Instagram has lost nearly half its daily users since an uproar over a proposed revised terms of use statement swept the Internet on Dec. 17, 2012.

AppStats says the photo-sharing service's daily users dropped from 16.35 million on the day of the controversy to 7.42 million as recently as yesterday. Instagram has since ditched the disputed terms-of-service plan, which (among other things) would have given Instagram free license to use anyone's uploaded image content in advertising. The terms would also have let Instagram share user information across the Facebook business.

Instagram now says its updated polices will let users retain ownership of the photos they post to the service while keeping privacy controls as they were previously. The re-revised Terms of Service and Privacy Policy is slated to go into effect this Saturday, Jan. 19th, 2013.

But the damage might already be done to Instagram.

“The main loss will be most likely due to the terms of service changes, given how much attention and controversy the terms of service change has brought, and seeing how clearly the Instagram app dropped after the terms of service change,” AppStats CEO Sebastian Sujka told The New York Post.

It's worth noting that another Facebook statistics tool with a similar name, AppData, issued a report late last year that showed a nearly 25% drop in use in the weeks following the controversy. Instagram disputed the report at the time, calling the data "inaccurate." Other independent outlets, including The Next Web, also took umbrage with the AppData report, saying it's fairly typical to see a downturn in online usage over the holidays. (UPDATE: We initially erroneously reported that the disputed late December 2012 report was also from AppStats. It was not. It was produced by AppData.)