The elephant in the room here is that big tech companies regular break laws, mostly with impunity. In many countries with a sane legal system (not sure if the USA is one of those), it is forbidden by law to arbitrarily discriminate consumers. That is, treat them differently for things they do that are neither an explicit breach of contract, nor illegal behaviour. I don't know enough of US law to say if this applies in the USA also, but companies like these ought to be publicly prosecuted for this elsewhere. The real problem is that big tech companies have vast resources (including economical and political influence) and all kind of (international) legal tricks up their sleeves, shielding them from the legal scrutiny they deserve. However, the clock is ticking. At some point, the net will close around them.
What law is being broken? This is their platform to do with as they please. Nobody has a contractual agreement whereby Facebook agrees to host any and all content. They can be as partial and capricious as they desire. That is the price for abandoning open protocols.
"it is forbidden by law to arbitrarily discriminate consumers"
(in many countries with a sane legal system)
It is a common and stubborn misconception that laws like these somehow do not apply to big (international) tech companies. It is more the product of cultural acceptance of a reality that has existed for long time. Maybe you are right about this, within the USA. But than that would say more about the legal reality within the USA, rather than globally.
There's a lot of unstated meaning wrapped up in "arbitrarily" there. You can obviously treat customers differently based on whether they pay or not, and you can obviously have terms that say what you can and can't post on the platform (and apply moderation accordingly). Otherwise you couldn't maintain any kind of forum or communication platform.
Saying you can't post links to other services may be distasteful, but shouldn't be illegal in any reasonable legal jurisdiction.
As I said: "treat them differently for things they do that are neither an explicit breach of contract, nor illegal behaviour"
In other words: these rules need to be explicitly stated in whatever contract consumer and provider agreed on.
These rules also need to be universally enforced. Rules that are (intentionally or not) written in such a way that they lend themselves for arbitrary application (that is, not equally amongst all consumers) are legally unenforcible. Therefore should be considered null and void. Which then leaves the service provider without any legal justification for their actions under contract law. That's at least how it works in many places, at least outside the USA.
More to the point: if you provide a service (or product) to the general public, you have to accept that people will user it as they see fit.
If you want to limit the ways your service (or product) can be used, you can do so by explicitly arranging these limitations through a contract. Things that are already (otherwise) illegal do not have to be included in this arrangement (hopefully for obvious reasons).
Whatever is not explicitly forbidden by either law or contract, are not valid grounds for treating consumers differently.
Sadly, and mostly for historical and cultural reasons (and law enforcers not paying attention for a long time), it is often assumed that these rules do not apply to big service providers (and software producers alike). However, I have never found any legal basis for why such companies should be treated any different than any other one.
In principle: yes. That is, as long as the agreement is not in violation of other rules/laws. Considering the role a service has in society and its market position, such a rule could e.g. violate anti trust law. But that's a different matter, and up to a court to decide.
Instragram offers their services to the general public, which makes the users of these services consumers. That is, if these are not businesses.
That Instagram uses the information gathered from providing these services for different services provided to another type of client (businesses, since consumers are officially not allowed to do business), does not change that.
But it could mean that Intragram is breaking laws that protect consumers (or citizens in general) from abusive practises. For example invasion of privacy (in particular surveillance), which is in many countries a privilege/monopoly limited to governments (just as use of violence).
When social media companies declared that privacy is dead, they essentially said that they do not acknowledge this monopoly/privilege of governments. This has been reality for some time, which is why many people got used to it and have accepted it as normal. However, just as criminals can claim that laws do not apply to them, the claims of social media companies might not have any legal basis. Maybe they have in the USA (I really do not know), but they sure appear to not have it in other parts of the world.