Instagram’s unsurprising back down over changes to its Terms and Conditions is yet another example of the ongoing tension between access and privacy that pervades the social media space. Time will tell whether the concessions made by Instagram will prove sufficient or whether its creep away from prioritizing the user over the advertiser will prove fatal to its success and Facebook’s expensive foray into the mobile advertising world.

What is clear, however, is that Facebook and Instagram users are facing increased pressure to forgo their privacy as Facebook seeks to serve Wall Street and its shareholders especially in light of the roller coaster ride its share price has ridden to the dismay of investors and employees.

It’s a difficult position for both companies to find themselves in, and perhaps even more so for Instagram. Facebook has had years to navigate the landscape of user privacy concerns with varying degrees of success. But Instagram now finds itself under the stewardship of Facebook whose privacy framework comes as quite a shock to the users of the relatively new Instagram platform. In a sense, the half-life of invasions into user privacy is getting shorter and shorter and this poses a very real threat to both the loyalty of users and Instagram itself.

If the experience of users is ultimately subsumed to the interests of Wall Street, shareholders and advertisers, the very emotional bonds on which Facebook and Instagram were built can be their undoing. In short, the advertising that can secure both companies financial success can also destroy them without balanced respect for both users and shareholder interests.

No social network – not even one with over a billion active accounts like Facebook – can survive a user revolt spurred by the belief that the company has surrendered the interests of its users to the bottom lines of shareholders.

This issue is at the heart of which social networks will survive and continue to thrive through the next five years, and which will suffer fatal erosion in the face of a more sophisticated and fractured social media landscape. Especially as they employ the cynical tactic of incrementally eroding user privacy and backing down to gradually overwhelm user interests.

As we have seen so dramatically with brands as diverse as Bank of America, Verizon, Netflix, Chick-Fil-A and even Apple, consumer activism rises in direct proportion to the compromise of customer interests.  Social networks such as Facebook and Instagram have established a dialogue with users that can no more be silenced than we can undo the web, and its Boards would do well to heeds the collective sentiment and interests of its users.

Do you think the current back down by Instagram is merely a postponement of a further erosion of privacy? Or will users desert it in sufficient numbers to steer Instagram in a direction that serves users and advertiser?

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