Kevin Systrom co-founder, Instagram said that in recent days, "it became clear that we failed to fulfill what I consider one of our most important responsibilities - to communicate our intentions clearly."
As a result of the confusion, the company has reverted back to its terms and conditions that have been in place since October 2010.
He also reiterated that Instagram had no intention of selling its users photos, and never did. That was the core of the outrage, and when calmer heads prevailed, it was seen that the text was badly worded and implied that they might sell photos to advertisers.
Going forward, the company wont change terms to reflect possible future products, until such products have been developed and are ready for launch.
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