It did the right thing responding so quickly to user feedback. Hopefully it'll result in a TOS that lets Instagram monetize without infringing on the privacy of its users.
And maybe just maybe they will review further TOS changes before unleashing them. If these terms were really against Instagram's plans, it's almost even more pathetic.
After reading some of the TOS changes and this blog post it really seems like a case of overzealous lawyering - trying to cover Instagram for all possible uses of the photos.
Not as Proper Noun Legal Advice, but more as a set of things which might be a concern, and you should have your own qualified legal counsel examine in detail if desired)
I can think of all sorts of problems though; malpractice, negligence, copyright infringement of ToS, libel for misinterpretations, and many more besides. Maybe that's why it doesn't (can't?) exist.
I think instagram/facebook should be able to monetize, but I think today marks a gigantic mistake in their history, they went down in myspace fashion. Users dropping like flies, the amount of traffic on services like instaport.me and http://freethephotos.com/ is phenemonal.
In other news, flickr came back from the grave.
What I don't get is why Instagram doesn't just let users pay for the value they are obviously receiving from the service.
http://blog.peterdonis.com/opinions/your-cloud-data-not-your...