The terms state that shared photos can be used:
“. . .in connection with paid or sponsored content or promotions, without any compensation to you.”
Theoretically, this means that if you upload a photo of, say, your dog, Instagram could sell it to a pet food company for them to use in advertising materials. And this could be done without you ever being notified or compensated.
But just because Facebook, which completed its purchase of Instagram three months ago, can sell images to companies doesn’t mean that it’s necessarily setting up a stock photo service where advertisers can buy these images from Facebook without any money going to the people who actually took the photos.
More likely, the updated policy means that Instagram may intend to use your content as part of its own advertising or in conjunction with Facebook’s advertising products.
So what does this mean for your business?
If you use Instagram for promotional purposes, then you shouldn’t upload any content that you wouldn’t want distributed to other companies for advertising or similar purposes.
However, Instagram already reserved some rights over shared photos under a “limited license,” and the new terms maintain that users still retain ownership of their images. But users that are worried about images being distributed within sponsored content on Instagram, Facebook, or other channels may want to explore other photo sharing options.
There are several third party sites such as Instaport and Copygram that allow Instagram users to save all their photos from the site so that they can have access to them if they choose to delete their accounts.