REPORTS that Facebook's Instagram lost almost a quarter of its daily users a week after it rolled out, and then withdrew policy changes, may have been ''cherry-picking'' statistics, but they may still point to a larger problem.
Last month, Instagram, which Facebook bought for $US715 million last year, suffered a backlash from users who feared the photo-sharing service would use their pictures for commercial purposes without compensation.
According to data compiled by online tracker AppData and reported by the New York Post , the number of daily active Instagram users who accessed the service via Facebook bottomed out at 12.4 million as of Friday, compared with a peak of 16.4 million the week before.
Instagram disputed the AppData survey, which was compiled from users that have linked the photo service to their Facebook accounts - historically between 20 and 30 per cent of Instagram members.
''This data is inaccurate. We continue to see strong and steady growth in both registered and active users of Instagram,'' a spokeswoman said in an emailed statement.
While daily usage has dropped, Instagram's monthly active users have edged up to 43.6 million as of Friday, an increase of 1.7 million over the past seven days, according to AppData.
The popular app, which allows people to add filters and effects to photos and share them over the internet or smartphones, experienced the drop over the brief, often-volatile holiday period.
While AppData told the Post on Friday it was ''pretty sure the decline was due to the terms of service announcement'', it has now issued a statement saying: ''Though the terms of service change spurred a lot of negative media attention and complaints from users, the decline in Facebook-connected daily active users began closer to Christmas, not immediately after the proposed policy changes.''