150 million use Instagram; ads coming in the next year

Instagram now has 150 million users with only 40% of those inside the U.S. A story in the Wall Street Journal on Sunday revealed the stats and also noted that 128 million of those were added after the site was acquired by Facebook. 50 million people have been added in just the past 6 months alone. Instagram now has 50 employees, up from the 4 it used to employ when it was only available to iOS users and had just 7 million users. But the app is now on iOS and Android and Windows Phone users have been dying for an official Instagram app.

One of the employees, 35 year old Emily White, has come over from the Facebook side with a mandate to monetize the site. The last time Instagram announced that it was monetizing the site, things backfired. Within days, the ToS was changed leading to an uproar from users who worried that their pictures were being sold to companies. Instagram backtracked on the ToS change and a class action suit against the social networking, picture sharing site was dismissed.

"Theoretically, [Instagram] could be making hundreds of millions of dollars today, but they would need a big sales force and they would risk polluting the environment."-Brian Wieser, analyst, Pivotal Research Group

But make no mistake about it. Ads are coming to Instagram within the next year, according to White. Her job is to figure out how to do it without shaking things up. "We want to make money in the long term, but we don't have any short-term pressure," see says. Checking out all of the major corporations with Instagram accounts, White has started meeting with heavyweights like Ford and Coca-Cola. The site is full of the demographics that companies crave, but White's challenge is to make sure that ads don't clutter the site. One idea is to make a separate page, like the Discover page, which shows different popular pictures and video, or the Search feature which shows off different themes. Allowing an advertiser to show off images that link back to a company's website might be a tasteful way to monetize Instagram.