Instagram Fail

In the month since announcing its new terms of service—and revoking them shortly thereafter—Instagram has lost half of its daily, active users:

According to data provided by app traffic company AppStats, Instagram, a unit of Facebook (NASDAQ:FB), has lost more than half of all its active users in the month since proposing to change its original Privacy Policy and Terms of Service. In mid-December, Instagram boasted about 16.3 million daily active users; as of Jan. 14, Instagram only has about 7.6 million daily users.

But all is not lost for Instagram. Data show that the popular photo-sharing app continues to gain monthly active users -- this could signal increased competition in the marketplace, or momentum taking its toll -- but unfortunately for Instagram, monthly users, by definition, post less often than daily users.

I expected a drop, but nothing this big. The ironic thing is that Instagram's new terms—because of their precision—gave the company fewer rights over your pictures. As opposed to the old—now current—terms, which are quite vague.