Users have a deadline period till 16th January. After that, they will not be able to opt out.
The changes in the policy also imply that Instagram can share information about its users with Facebook, which happens to be its parent company now, and also with advertisers and affiliates.
The move has enraged users.
VP of global marketing solutions at Facebook, Carolyn Everson had mentioned earlier this month that with time there will be a way to monetize Instagram.
However, Instagram mentioned that it intends to make things simpler to work with Facebook. It said in the statement that the move is to fight spam more efficiently, identify reliability issues faster and make features for all users by understanding how Instagram is used.
The updated policy, however, will not change the ways in which ownership of photos are handled or who is able to view the pictures of a user.
The new policy has prompted a criticism among several social media users.
Clayton Cubbit, a photographer based in New York has stated in his account that the updated policy is a suicide note.
Analysts feel that the new policy could result in a severe blow to the reputation of Facebook and push away some users.