Google DIDN'T pay $1b for Instagram, they paid for something totally different.
A company cannot obtain/record your personal information from another person/company without your explicit permission.Instagram had 30 million users.Ipsum facto Google actually bought the rights to 30 million user's worth of data and a channel through which to funnel it.
So they essentially paid $35 per user thats registered on instagram. That user data will now be integrated into google's data centre and all of its services from gmail to G+, from Google Code to Google Earth.Don't believe me then ask yourself why it took them so long to purchase Instagram (its been around for a bit and has been known off for a bit) or why they didn't buy instagram's competition instead?