When Instagram changed their terms of service to include a section about how they have the right to sell photos that people take on the mobile photo social network as ads, they were hit with a class action lawsuit. National Geographic stopped uploading the photos to Instagram temporarily until Instagram changed their terms of service back to the way it was or make it more fair. Instagram CEO Kevin Systrom said that the company did not intend on selling photos. A company called AppData claimed that Instagram had a 25% drop in “daily active users” ever since the new terms of service was released.
An Instagram spokesman said that “This data is inaccurate.” He added “We continue to see strong and steady growth in both registered and active users of Instagram.”
Supposedly AppData tracks usage through Facebook logins so their numbers are not exactly accurate, but some trends can be observed from this data. Apparently there must be something wrong with AppData’s data-tracking because they saw the same steep drop in Pinterest, Spotify, FarmVille 2, and many other applications on Christmas Day.
Facebook’s stock price dropped 2.9% after a report from the New York Post reported the news that Instagram lost around a quarter of their daily active users. The stock started recovering after several media companies reported The New York Post was wrong.