A Few More Thoughts About the @Woolworths_SA #HummingbirdGate Controversy

I thought I’d explore some of the legal themes that have emerged from this #HummingbirdGate story even though the story has since developed further and doesn’t seem to be quite what everyone assumed it was in the first place. Two major legal themes are copyright infringement and unlawful competition.

This last weekend has been an interesting one. The Twitter community seems to be convinced that Euodia Roets was ripped off by an unscrupulous Woolworths despite numerous statements and interviews by Woolworths representatives which have denied this and have pointed to a process which was concluded months before entering into discussions with her and which led to the product range Ms Roets contended was derived from her ideas.

What We Have Learned So Far

More information about this controversy has emerged in the last few days. Here are some of the things we have learned:

  1. Woolworths embarked on a process prior to entering into discussions with Ms Roets and signed off on their designs in November 2012;
  2. Woolworths representatives met with Ms Roets in early 2013 and even though Ms Roets gave Woolworths’ representative a sample with her hummingbird image, it probably would not have influenced Woolworths’ production process;
  3. Ms Roets’ hummingbird is very similar to a work produced by photographer, RW Scott in the late 1990s.

I thought I’d explore some of the legal themes even though the story has since developed further and doesn’t seem to be quite what everyone assumed it was in the first place. The recording below is a summary of the controversy and an outline of what I see as two major legal themes: copyright infringement and unlawful competition.

Before you read further, you should also listen to Jon Robbie’s interview with Woolworths’ CEO this morning:

Copyright Infringement

Many commentators have highlighted the copyright aspect of the controversy. Ms Roets highlights this in her blog post when she compares her drawing and the scatter cushion she came across in Woolworths (I included both images in my previous post). At some point someone pointed out that Ms Roets’ design looks remarkably like a photograph taken by RW Scott in the late 1990s and they are remarkably similar. This is RW Scott’s image titled “Female Ruby Throated Hummingbird”:

It is a beautiful image, as is Ms Roets’ version. If Ms Roets based her image on RW Scott’s image, her image would likely be classified as a derivative work. Assuming Ms Roets’ image is the result of sufficiently creative work on her part, it could also benefit from copyright protection despite the risk of her derivative work also infringing RW Scott’s work. Whether Ms Roets’ hummingbird infringed RW Scott’s copyright would depend on whether she had permission to use it as the basis for her work (assuming she used his work as the inspiration for hers). If she didn’t have permission (bearing in mind she was selling her hummingbird image, she probably can’t take advantage of exemptions to copyright infringement to escape an infringement claim), whoever owns the rights in RW Scott’s work could probably insist that she stop selling hers. Flowing from this, if Ms Roets copied RW Scott’s work without permission and if Woolworths copied her work without ensuring it had permission, then both Ms Roets’ and Woolworths’ works would infringe RW Scott’s. Again, making a number of assumptions here.

Interestingly, Woolworths said, in its statement, that it commissioned its version of the hummingbird from an artist in Durban in 2012. If that artist derived his or her work from RW Scott’s photograph and did so without permission, that would place Woolworths in a difficult position[1].

Unlawful Competition

Much of the commentary conflated copyright infringement with what people seemed most upset with: an unlawful competition angle. If Woolworths stole Ms Roets’ idea, that would probably fall under a class of unlawful competition referred to as a misappropriation of a competitor’s performance. In this case that could be the case if Woolworths used Ms Roets’ idea for a cushion bearing her hummingbird design. Given that she was selling her cushion and Woolworths intended selling its version, she would clearly be a competitor (even if not a particularly threatening one) and if Woolworths hadn’t come up with its own idea independently, using her idea to subsequently produce its own range could be a form of unlawful competition.

For this to apply, Woolworths would essentially have had to have copied the product of Ms Roets’ efforts without much additional effort of its own. For various reasons this doesn’t seem to have occurred but it is certainly an interesting, if hypothetical, aspect of this controversy.

Important Take-away

Something Woolworths’ representatives pointed to which is crucial (and will be increasingly important as more collaborative business models evolve) was how it documented every step of its production process and can point to specific dates and phases of its process of sourcing, developing and ultimately taking the idea to production. This sort of pedantic and legally motivated process isn’t very exciting and can slow a creative process down but it is in times like these that you would be very happy you took your lawyer’s advice to so this. I suspect the member of Woolworths’ legal team who insisted on this documentation process is the object of much gratitude and appreciation right now.

  1. This is why it is essential to include warranties and indemnities about copyright ownership in contracts with external providers. Those sorts of clauses are basically guarantees by the providers that they have sufficient rights to pass along to their client and will take responsibility if the client is later sued for copyright infringement.  ↩

The @Woolworths_SA hummingbird: a parable

One day, not too long ago, a young artist named Euodia was invited to contribute some of her work to a product range a local merchant called Woolworth was putting together. The two met frequently and Euodia was pretty excited about the prospect of her work being added to Woolworth’s inventory, he was well regarded in the area and all the local farmers saved for months to buy his goods.

One day, not too long ago, a young artist named Euodia was invited to contribute some of her work to a product range a local merchant called Woolworth was putting together[1]. The two met frequently and Euodia was pretty excited about the prospect of her work being added to Woolworth’s inventory, he was well regarded in the area and all the local farmers saved for months to buy his goods.

Euodia shared many of her ideas and artworks with Woolworth including a painting of a hummingbird she was selling in her store. One of the ideas they discussed was a pillow with her hummingbird printed on it. That would surely be a treat!

Sadly, Woolworth decided against continuing with Euodia and he sent her a note a few months later letting her know. She was disappointed and went on her way. A short while later, she happened to come across a store selling Woolworth’s goods and noticed a pillow with a hummingbird on it that looked remarkably like hers. She was shocked! The pillow size looked about the same as the one she discussed with Woolworth and he even seemed to take words about hummingbirds from the legendary Book of Wiki and used it as a background on the pillow and there was no mention of his source at all[2]. Shameful!

She has heard stories about Woolworth doing something like this to other artisans in the land, including a young fellow called Frankie who came up with an idea for some old-style cool drinks which some locals seem to favour. She was horrified to discover that she seemed to be next in line. She felt compelled to share her story and published her sad tale in her newsletter. Soon, it seemed even the birds were twittering about it. Everyone was shocked.

When Woolworth heard the story from a number of little birdies, he was dismayed and published a notice of his own. He said he had been talking to another talented artist in a coastal town some time ago about a similar concept and didn’t steal Euodia’s idea. It was all a bit misunderstanding and he had sent many messages to Euodia in an effort to meet with her and sort this whole thing out.

The people weren’t convinced. They heard about poor Frankie and were outraged that Woolworth had stooped to this level. They quickly came together and decided to petition Woolworth to stop taking advantage of local artisans.

A young writer read a story in a local paper and gave this all some thought. He hadn’t worked with Woolworth before but something about the story and what everyone was saying about Woolworth seemed to miss a possible explanation. He decided to investigate whether Woolworth really did pull the wool over everyone’s eyes or whether something else was afoot.

In the meantime, some intrepid journalists discovered that Euodia’s hummingbird may not have been completely original work either. This just fuelled our young writer’s curiosity so he set off for his local thinking spot under a shady tree and conducted a thought experiment.

Certainly, he thought, Woolworth could be the devious and unprincipled trader many accused him of being and if he had stolen Euodia’s idea like he seemed to have taken Frankie’s, he deserved the scorn he was receiving. In addition, given how closely other traders listen to messages carried by birds, Woolworth would almost certainly discover that a black reputation could have dire consequences for his value on local markets.

Perhaps, he thought further, there was another explanation. He had dabbled in laws and had noticed that most talented and persuasive business people like Woolworth tended not to consult with their lawyers. Their business was dynamic, exciting and full of potential and lawyers just seem to suck the light and colour out of the room when they speak. Perhaps Woolworth didn’t consult with his lawyers in their dungeons when he came up with his plan to work with Euodia.

Or, our young thinker thought, Woolworth did speak to his lawyers and they gave him a deed or some sort for Euodia to sign and which gave him permission to use her art in some form or another? She didn’t mention anything about that but it has been known to happen[3].

Exploring his first hypothesis a little further, our writer found himself wondering whether Woolworth, mindful of the Frankie story (and other similar stories), shouldn’t have adopted a different approach. Imagine Woolworth approached Euodia to contribute to his new artisan range not merely as a muse or supplier but as a creative partner of sorts. The world is a competitive place and you can’t help but hear stories about young creative people like Euodia outdoing established business people like Woolworth. Certainly, Woolworth’s products seem to bear that out. He certainly seemed to believe that Frankie was on to something great when he styled his drinks after Frankie’s. Similarly, Woolworth seemed to draw considerable inspiration from his discussions with Euodia in producing his hummingbird cushions.

Perhaps the problem here is that Woolworth didn’t challenge the usual relationship between traders like himself and young artisans like Euodia and come up with something that could clearly and transparently have benefitted both of them. What if he approached Euodia to publicly collaborate with him to produce the hummingbird product range using her designs[4] in his aptly named “Artisan” range. She would work with him to create wonderful designs for beautiful products and they would share the credit for the work. Woolworth could use his Artisan range to draw attention to the wonderful local talent Euodia and others represent and perhaps even have them sign their designs. The message he would send would be clear: Woolworth appreciates and supports wonderful, creative and, importantly, local talent and perhaps even goes so far as to create a platform for a select few to represent and uplift their communities.

The lawyers, if they are imaginative enough[5], could construct deeds to support this community upliftment initiative and enable Woolworth to go far further than his competitors in sustainably creating products that bring his customers even more joy. Most people know Woolworth is passionate about supporting schools and communities. Wouldn’t this be a remarkable way to do even more to support them and create opportunities for rich and diverse creativity to fuel it all?

Our writer stood up from his shady spot and ambled back to his small office. He smiled to himself at the thought of a progressive Woolworth. Imagine what he could accomplish. The people would be even more inspired to buy his goods because they would know they would be supporting local, amazing and creative talent.

  1. Disclaimer: This is partly fiction and mostly derived from reports about the so-called #HummingGate controversy which erupted online recently about Woolworths’ dealings with Euodia Roets. It is not based on any actual insights into anyone’s or any company’s methodologies and business practices (because I don’t have any actual insights). This is essentially a “what if?” story.  ↩

  2. As all in the land know, text in the Book of Wiki is available to all under a Creative Commons Attribution-ShareAlike 3.0 Unported license which allows many uses but also imposes attribution and license annotation requirements.  ↩

  3. Well, if this was the case, what Woolworth could do with Euodia’s work would depend very much on the wording of that document and he could have the right to do what he did after all, assuming he did what he stands accused of doing.  ↩

  4. Of course this assumes that the hummingbird in question was, in fact her design, and she didn’t draw direct inspiration from another artist. That would complicate matters considerably and our writer could just imagine groups of lawyers rubbing their grubby hands together in glee at the prospect of that.  ↩

  5. A big if but there are some pretty innovative lawyers out there these days.  ↩

ANN7 sings the Streisand Effect blues

News channel ANN7 has been the object of both considerable ridicule and controversy lately. On the one hand, the 24 hour news channel launched by the similarly controversial Gupta family has been criticised for poor production values and content and, on the other hand, an Indian company known as Aiplex Software has been filing take down notices with YouTube in an effort to remove a growing number of satirical videos targeting the fledgling station.

Update: I was interviewed on Cape Talk 567 about the copyright infringement aspects of this controversy. Here is the audio from the interview:

News channel ANN7 has been the object of both considerable ridicule and controversy lately. On the one hand, the 24 hour news channel launched by the similarly controversial Gupta family has been criticised for poor production values and content and, on the other hand, an Indian company known as Aiplex Software has been filing take down notices with YouTube in an effort to remove a growing number of satirical videos targeting the fledgling station.

In the meantime, ANN7 has become the latest victim of the Streisand Effect and the storm Aiplex Software has kicked up has probably exacerbated the situation for ANN7 considerably instead of what it likely expected, namely, suppressing the criticism.

What Aiplex Software seems to have done is lodge take down notices with YouTube under the US Digital Millennium Copyright Act. YouTube is practically required to remove the offending content if it wishes to benefit from a liability shield extended by the DMCA (unless it takes the view the take down notice has no basis and YouTube resists it). Given the volume of content published to YouTube, the take down process was probably automated although it remains open to the users who published the videos to file counter take down notices calling on YouTube to reinstate the videos. I understand from one report that one user has done just this.

The basis for the take down notices is that the offending videos have infringed ANN7’s copyright in its materials (the videos largely include footage from ANN7). The South African Copyright Act (which likely doesn’t apply directly but may be useful comparatively) recognises copyright in what it defines as cinematographic films but also includes specific exceptions for some content uses. The section of the Act that introduces this idea is section 12 which refers to grounds on which content may be used and where those uses will not infringe copyright. Section 16 of the Copyright Act deals with exceptions to copyright infringement specifically relating to cinematographic films and includes these two exceptions:

  • for the purposes of criticism or review of that work or of another work; and
  • for the purpose of reporting current events―
    • in a newspaper, magazine or similar periodical; or
    • by means of broadcasting or in a cinematograph film

This is subject to the proviso that, in the case of the first exception and the first part of the second exception (dealing with “newspaper, magazine or similar periodical”), “the source shall be mentioned, as well as the name of the author if it appears on the work”. Without going much further in the Act, it allows for critical reproductions of the footage provided there is proper attribution required by the proviso or, where the footage is being reproduced for the purposes of reporting on the story, there must be proper attribution in a “newspaper, magazine or similar periodical”.

Bearing in mind that the proviso requires attribution of the source of the footage and the author’s name “if it appears on the work”, including footage which clearly originates from ANN7 may be sufficient to invoke the exception to copyright infringement on the basis of criticism or a review of the footage where the author’s name doesn’t appear in the footage.

American copyright law has a broad set of copyright infringement exceptions known, collectively, as “fair use” which include exceptions based on criticism. It also includes protections for parody which may also apply to videos targeted for removal by Aiplex Software. The end result is that these videos may well be reinstated once users’ counter take down notices are reviewed.

In the meantime, Aiplex Software’s campaign to remove these videos and target other critical materials is only heightening public interest in ANN7’s content and quality and, quite possibly, attracting even more attention that it would have had otherwise. This is the hallmark of the Streisand Effect and the phenomenon doesn’t draw a distinction between legitimate efforts to protect rights and less legitimate efforts.

Of course there has been considerable attention and debate on Twitter and one question I have been asked is whether Aiplex Software could target Twitter users for criticising ANN7 or the increasing number of parody accounts. Unfortunately, Aiplex Software may not find Twitter to be very accommodating. Twitter’s various policies include a fairly clear Parody, commentary and fan account policy which could well protect parody profiles:

If an account is engaged in parody and follows all of the above recommendations, it will generally be free to continue in its parody so long as it doesn’t mislead or deceive others. These are considered best practices for clearly marking accounts as one that is engaging in non-impersonation parody/commentary.


p>Twitter has a pretty robust approach to free expression and Aiplex Software may not be too well received. Any potential prejudice caused by copyright infringement will almost certainly be dwarfed by the reputational harm magnified by the Streisand Effect thanks, to a large degree, to the campaign to suppress criticism and ridicule. It’s not clear that Aiplex Software has a valid basis to require these videos to be taken offline and that doesn’t really matter. What does matter is that members of the public are fascinated with this story and they are sharing their opinions widely and rapidly.

The Facebookification of Instagram’s Terms of Use

Update (2012-12-21): Instagram has published a revised version of the Terms of Use. You can read about the changes in our follow-up post.

Instagram_Icon_LargeInstagram announced changes to its Terms of Use and Privacy Policy in an innocuous blog post on 17 December 2012:

Our community has grown a lot since we wrote our original terms of service. To get things up to date for the millions of people now using Instagram, we’re bringing you new versions of our Privacy Policy and Terms of Service.

Here are a few key updates:

  • Nothing has changed about your photos’ ownership or who can see them.
  • Our updated privacy policy helps Instagram function more easily as part of Facebook by being able to share info between the two groups. This means we can do things like fight spam more effectively, detect system and reliability problems more quickly, and build better features for everyone by understanding how Instagram is used.
  • Our updated terms of service help protect you, and prevent spam and abuse as we grow.

This is just a small preview. Our new Privacy Policy and Terms of Service will be effective on January 16, 2013.

We know these documents are a little dry, but they’re very important. Please take a moment to read through them so you keep feeling comfortable sharing your beautiful photos on Instagram.

A closer look at both updates reveals a number of changes and a few concerns which are not mentioned in this brief blog post.

New Terms of Use

To begin with, the new Terms of Use are dramatically expanded and run to over 6 000 words, compared to the current version’s 1 000-odd words. Comparing the two sets of Terms of Use side by side reveals that many of the changes are expanded versions of existing provisions but there are quite a few more substantive changes lurking within these expanded clauses and we have highlighted many of the more significant changes below. The way we have structured this review is by reference to the headings used in the documents. Where the headings are the same, we just used the heading title for both versions. Where the heading titles are different, we use the format “Old Heading / New Heading” so you can follow along with us if you are inclined to do so.

Basic Terms

This section is essentially a sort of acceptable use policy for the service and has been fairly dramatically expanded. For example, paragraph 3 of the current version states the following:

You are responsible for any activity that occurs under your screen name.

The same paragraph in the new version states the following:

You are responsible for any activity that occurs through your account and you agree you will not sell, transfer, license or assign your account, followers, username, or any account rights. With the exception of people or businesses that are expressly authorized to create accounts on behalf of their employers or clients, Instagram prohibits the creation of and you agree that you will not create an account for anyone other than yourself. You also represent that all information you provide or provided to Instagram upon registration and at all other times will be true, accurate, current and complete and you agree to update your information as necessary to maintain its truth and accuracy.

This particular change was more of an expansion of a relatively simple version of the paragraph. There are quite a few of these sorts of changes in this section of the new Terms of Use.

General Conditions

While not really a change to the Terms of Use, this section includes a new version of the following paragraph allowing for changes to the Terms of Use:

We reserve the right to alter these Terms of Use at any time. If the alterations constitute a material change to the Terms of Use, we will notify you via internet mail according to the preference expressed on your account. What constitutes a “material change” will be determined at our sole discretion, in good faith and using common sense and reasonable judgement.

The new paragraph is very similar to the amended counterpart in Facebook’s Terms of Service and it is one of the clauses which reveals the Facebook integration and influence over Instagram’s operations:

We reserve the right, in our sole discretion, to change these Terms of Use (“Updated Terms“) from time to time. Unless we make a change for legal or administrative reasons, we will provide reasonable advance notice before the Updated Terms become effective. You agree that we may notify you of the Updated Terms by posting them on the Service, and that your use of the Service after the effective date of the Updated Terms (or engaging in such other conduct as we may reasonably specify) constitutes your agreement to the Updated Terms. Therefore, you should review these Terms of Use and any Updated Terms before using the Service. The Updated Terms will be effective as of the time of posting, or such later date as may be specified in the Updated Terms, and will apply to your use of the Service from that point forward. These Terms of Use will govern any disputes arising before the effective date of the Updated Terms.

This new clause is somewhat vague about which sorts of updates would trigger a notification to you and, even if Instagram does notify you about a change, your notification could be a publication to the Service. This means that you need to be fairly vigilant when it comes to updates to the Terms of Use and you should check in on the application version from time to time if this sort of thing concerns you.

It’s worth noting that Instagram reserves the right to take your username away in some circumstances. This isn’t new but given how much attention Facebook pays to brands and accommodating them in its services, your username could be vulnerable if it corresponds with a brand, among other things. The clause in the new Terms of Use is somewhat broader than the existing paragraphs 4 and 6 which state the following:

We reserve the right to force forfeiture of any username that becomes inactive, violates trademark, or may mislead other users.


We reserve the right to reclaim usernames on behalf of businesses or individuals that hold legal claim or trademark on those usernames.

The new paragraph 5 simply states the following:

We reserve the right to force forfeiture of any username for any reason.

A new paragraph 8 in the updated Terms of Use both acknowledges the more connected nature of the Instagram service and possible integrations with third party services:

There may be links from the Service, or from communications you receive from the Service, to third-party web sites or features. There may also be links to third-party web sites or features in images or comments within the Service. The Service also includes third-party content that we do not control, maintain or endorse. Functionality on the Service may also permit interactions between the Service and a third-party web site or feature, including applications that connect the Service or your profile on the Service with a third-party web site or feature. For example, the Service may include a feature that enables you to share Content from the Service or your Content with a third party, which may be publicly posted on that third party’s service or application. Using this functionality typically requires you to login to your account on the third-party service and you do so at your own risk. Instagram does not control any of these third-party web services or any of their content. You expressly acknowledge and agree that Instagram is in no way responsible or liable for any such third-party services or features. YOUR CORRESPONDENCE AND BUSINESS DEALINGS WITH THIRD PARTIES FOUND THROUGH THE SERVICE ARE SOLELY BETWEEN YOU AND THE THIRD PARTY. You may choose, at your sole and absolute discretion and risk, to use applications that connect the Service or your profile on the Service with a third-party service (each, an “Application”) and such Application may interact with, connect to or gather and/or pull information from and to your Service profile. By using such Applications, you acknowledge and agree to the following: (i) if you use an Application to share information, you are consenting to information about your profile on the Service being shared; (ii) your use of an Application may cause personally identifying information to be publicly disclosed and/or associated with you, even if Instagram has not itself provided such information; and (iii) your use of an Application is at your own option and risk, and you will hold the Instagram Parties (defined below) harmless for activity related to the Application.

Aside from the obvious application to services that are not Instagram and the possibility that your Instagram profile and content may be integrated into those services, the way the key term “Service” has been defined introduces the possibility that Facebook may be one such “third-party web site”. “Service” is defined as “the Instagram website, the Instagram service, or any applications (including mobile applications) made available by Instagram”. This doesn’t appear to include Facebook so whenever you see a reference to “third-party web sites”, bear in mind this could well include Facebook and enable a workaround for the restrictions Instagram imposes on itself in the Terms of Use.

Proprietary Rights in Content on Instagram / Rights

This section has changed quite a bit and is the source of some justifiable concern.

Content Licensing

As a starting point and, in anticipation of media hype and interpretive challenges, Instagram does not claim ownership of any of you content. The big question is how broad the license it takes from you is and what that license enables Instagram to do? The current license basically states the following:

By displaying or publishing (“posting”) any Content on or through the Instagram Services, you hereby grant to Instagram a non-exclusive, fully paid and royalty-free, worldwide, limited license to use, modify, delete from, add to, publicly perform, publicly display, reproduce and translate such Content, including without limitation distributing part or all of the Site in any media formats through any media channels, except Content not shared publicly (“private”) will not be distributed outside the Instagram Services.

I added the emphasis on the core license scope. The new license states the following (I added the emphasis):

you hereby grant to Instagram a non-exclusive, fully paid and royalty-free, transferable, sub-licensable, worldwide license to use the Content that you post on or through the Service, except that you can control who can view certain of your Content and activities on the Service as described in the Service’s Privacy Policy, available here: http://instagram.com/legal/privacy/.

Notice how the publicity of private content shifts from no disclosure outside the Instagram Service to being able to control “certain of your Content and activities”. The new privacy policy includes this new addition to the section about sharing your personal information which is not in the current (soon to be old) privacy policy:

We may share User Content and your information (including but not limited to, information from cookies, log files, device identifiers, location data, and usage data) with businesses that are legally part of the same group of companies that Instagram is part of, or that become part of that group (“Affiliates”). Affiliates may use this information to help provide, understand, and improve the Service (including by providing analytics) and Affiliates’ own services (including by providing you with better and more relevant experiences). But these Affiliates will honor the choices you make about who can see your photos.

What this means is that, under the new Terms of Use and Privacy Policy, your personal information and Content can be shared with Facebook and other companies that become part of Facebook’s group of companies. The way the Privacy Policy is framed, you agree to this merely by using the Service. Depending on how you feel about Facebook accessing your Instagram content and personal information shared with Instagram, this could be a big concern for you.

Returning to the licenses, the new license introduces two important permissions: the ability to transfer or even sub-license the license you grant to Instagram. The license doesn’t limit who the rights you grant can be transferred or sub-licensed to (and the new license wording even drops the reference to a “limited license” in the current license wording although that phrase may be redundant) and doesn’t go into much detail regarding what “use” entails. The current license is more specific and allows Instagram to –

use, modify, delete from, add to, publicly perform, publicly display, reproduce and translate such Content, including without limitation distributing part or all of the Site in any media formats through any media channels …

The new wording is pretty vague and broad and one interpretive question is what “use” encompasses in the context of the new wording?


This part of the new wording is pretty worrying. It concerns advertising revenue and the change from the current wording to the new wording is dramatic. The current paragraph 2 states te following (I added the emphasis):

Some of the Instagram Services are supported by advertising revenue and may display advertisements and promotions, and you hereby agree that Instagram may place such advertising and promotions on the Instagram Services or on, about, or in conjunction with your Content. The manner, mode and extent of such advertising and promotions are subject to change without specific notice to you.

This sort of provision is pretty common. You get to use these services for free and, in return, the companies operating the services make money by presenting you with advertisements. You may not like it but these services cost money to operate and these providers have typically worked to maintain a balance between presenting advertising in the most compelling way with not alienating users. The new wording in the Terms of Use not only expand this mechanism, they change the model dramatically and with the result that you truly are the product. This is what the new paragraphs 2 and 3 say (once again, I added emphasis):

  1. 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 pay us to display your username, likeness, photos (along with any associated metadata), and/or actions you take, in connection with paid or sponsored content or promotions, without any compensation to you. If you are under the age of eighteen (18), or under any other applicable age of majority, you represent that at least one of your parents or legal guardians has also agreed to this provision (and the use of your name, likeness, username, and/or photos (along with any associated metadata)) on your behalf.

  2. You acknowledge that we may not always identify paid services, sponsored content, or commercial communications as such.

Pseudo-endorsement ads on Facebook-2This model takes the advertising mechanism beyond simply displaying ads in a way that you can see them. It brings you into the advertisements by using your image, your photos and metadata like location as well as your actions (liking or commenting on something, perhaps) and associating that personal information and content with the advertisements. This is something Facebook has been doing for a while and it implies an endorsement. Paragraph 3 stops just short of stating that Instagram will use your content and personal information to imply an endorsement of a company or its products without clarifying that the advertisement is, in fact, an advertisement that was paid for or sponsored.

While the more conventional display ad model raises privacy concerns with how the ads are targeted, this new model potentially has privacy, reputational and even commercial implications for Instagram users. A person may not wish to be so closely associated with a brand or a product for various reasons. That person may already be associated with a competitor as part of a commercial arrangement or the brand or product the user is associated with through this advertising model may run contrary to the user’s beliefs and preferences. This new mechanism gives Instagram the ability to trade off your identity, personal information and your Content and it begs the question whether the cost of using the Instagram service isn’t becoming a little too high?

Facebook has a very similar mechanism in its Statement of Rights and Responsibilities:

About Advertisements and Other Commercial Content Served or Enhanced by Facebook

Our goal is to deliver ads and commercial content that are valuable to our users and advertisers. In order to help us do that, you agree to the following:

  1. You can use your privacy settings to limit how your name and profile picture may be associated with commercial, sponsored, or related content (such as a brand you like) served or enhanced by us. You give us permission to use your name and profile picture in connection with that content, subject to the limits you place.
  2. We do not give your content or information to advertisers without your consent.
  3. You understand that we may not always identify paid services and communications as such.

Unlike the Facebook model (which is almost as invasive), the Instagram model doesn’t include an option to restrict this form of advertising using privacy settings in the wording itself. If you consider that Instagram is also available to minors from the age of 13, children under the age of 18 could find their identity, content and other personal information associated with brands and products without their knowledge (at least until their friends let them know) on the flawed assumption that they have their parents’ or guardian’s consent.

Other additions

The current Terms of Use pretty much stops at this point but the new Terms of Use includes a series of additional sections including the following:

  • Reporting Copyright and Other IP Violations;
  • Disclaimer of Warranties;
  • Limitation of Liability; Waiver;
  • Indemnification;
  • Arbitration;
  • Time Limitation on Claims;
  • Governing Law & Venue;
  • Entire Agreement; and
  • a very interesting section titled “Territorial Restrictions”.

This last section is a bit like the secret scene at the end of a movie. The premise of this section is as follows:

The information provided within the Service is not intended for distribution to or use by any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject Instagram to any registration requirement within such jurisdiction or country. We reserve the right to limit the availability of the Service or any portion of the Service, to any person, geographic area, or jurisdiction, at any time and in our sole discretion, and to limit the quantities of any content, program, product, service or other feature that Instagram provides.

Immediately below this section is a copy of the current Terms of Use. What is odd about this is that there is no indication what purpose repeating the current Terms of Use has. Are the old Terms of Use meant to apply where territorial restrictions render the new Terms of Use unlawful or unenforceable? Was this just an error when the new Terms of Use page was prepared? It this was intentional it looks as if the current Terms of Use may be a fall back set of terms and conditions if the new Terms of Use is legally problematic in some region outside the United States.

Either way, it is very odd.

As you noticed, we haven’t dealt with the new Privacy Policy in much detail in this post. We’ll explore the changes to the Privacy Policy in a further article.