Expect Facebook to Lose a Ton of Money on Instagram

NEW YORK ( TheStreet) -- I tend to agree with the way Mark Zuckerberg handles most things at Facebook ( FB).

But I'm beginning to wonder what in the world he is doing with Instagram. Maybe he's not doing anything. The other day a friend suggested that because it's newly acquired, CEO Kevin Systrom might still be calling the shots at the sociophoto network. (When somebody at CNBC starts using that new word, remember where you heard it first.)

I scoff at the notion of Zuckerberg not taking immediate control of Instagram, but it's apparently not all that far-fetched. I understand that's the way things rolled in the early stages of the Google ( GOOG)/ YouTube integration.

If Zuckerberg is saying, we're not going to interfere, keep doing what you're doing, he better channel Steve Jobs and rethink the strategy.

In the span of just over a week, Instagram or Facebook or some combination of the two made a pair of bonehead moves.

I discuss the first one -- taking full Instagram functionality away from Twitter -- in Facebook Acting Like a Twit On Instagram. TheStreet's Chris Ciaccia nicely covers the most recent bungle -- Instagram's terms-of-use snafu -- in Facebook's Instagram Catches Hell From Users on Privacy Changes.

Let's take this slowly . . . Facebook made a massive mistake making such a large bet on and apparently having so much confidence in Instagram.

Here's where I think Zuckerberg -- whether he's calling the shots or not (and he must have at least some broad oversight) -- is getting it wrong: He's putting Instagram in the same league as Facebook.

Dissing Twitter was a bold, but bad move. I explain why in the first of the two above-linked articles. And pulling a fast one on privacy doesn't fly when you're not special. Facebook can do this -- it has several times -- because it's Facebook. That's why the social network never missed a beat after the many times Zuckerberg played fast and loose with privacy.

Facebook is sticky; it's addictive. Most of its users aren't going anywhere and, for every one that does leave, several others, pets and infants included, take that spot.

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