• by Steve Smith , Staff Writer @popeyesm, January 17, 2013

For many links in the online media and marketing supply chain, the privacy issue is a source of persistent frustration. Many in the industry, even those who champion greater transparency and self-regulation, often argue that the issue exorcises a select group of privacy watchdogs and journalists more than it actually does consumers. Look at the low rate of people who actually manage their online profiles when given the chance, they argue. Well, maybe.

The issue of how media and marketers use the trail of behaviors they leave behind in cookies was one thing. But social media, with its proliferation of user-generated content, raised the issue of user-control to a new level. It turns out that people really do care about their data when it involves stuff they make and share. How much of one’s generated data should a social network own and use as they see fit?

Instagram fell into that hole late last year when its new privacy policies and terms of service literally made headlines on national news services within 24 hours of their release. In fact, one of the most prominent media brands using the image sharing and editing network, National Geographic, publicly announced within a day that it was suspending posts to Instagram until the polices were clarified.

Oops. Instagram quickly retreated and promised an update to the update. Those revisions were issued several weeks ago, assuring users that they retained ownership of their images and that personal material was not going to show up in ads.

But here is the thing. What did the company really learn here about its own users, the press, content partners? Yesterday, on the day the new policies went into effect, the company sent an email to everyone that linked to co-founder Kevin Systrom’s conciliatory blog post of several weeks ago that contained only slightly more helpful illuminations of revised changes than the initial ham-handed post. Worse, they still aren’t using their own app to notify their user base.

This would have been a perfect time to clarify even further the changes, declare the motives and values of the team, and work on that trust thing that should be so valuable to any social network.

It is disheartening to see a new generation of startups like Instagram and parent Facebook treat privacy and user trust as another A/B test. Put something out there and optimize on feedback. Granted, we all are in uncharted territory when it comes to digital data ownership and control, the limits of privacy protection in this age, etc.

What we could use are a few companies to lead with clear new ideas about exchanges of value that are stated openly, but also with some sense of conviction.