I trust Instagram to not engage in monkey business with my data. Having said that, this is flirting with the path-address-book kind of privacy-related scrutiny. There has to be a way of telling the user at WHAT POINT the data has started uploading. The progress bar of photo uploads has to mean what it shows or else it is a plain and simple deception (even if it's in the name of performance and user experience). I can't tell if this will erode trust though but don't be surprised if a few make a loud noise about it.
Privacy concern and trust form a chicken-egg problem. I wish the Stanford-esque brains behind these tech companies had a better grasp on it.
Actually yes I do trust them to the same extent. But that's a choice I have made based on my perceived trust level. I am even OK with advertisers harvesting my photos (not sure if that is possible yet). My main desired privacy control is whether people that are not supposed to see my photos or browse through my galleries, actually get to do that. That's not necessarily a monkey business but an outcome of a privacy implementation flaw (assuming it is unintentional). That will certainly have an impact on my trust level for Facebook. The difference with instagram is that you go into instagram knowing that everything is public and so is the general sharing norm on that platform.
Privacy concern and trust form a chicken-egg problem. I wish the Stanford-esque brains behind these tech companies had a better grasp on it.