Heard this briefly on the radio this morning as i was getting up. Having read the story not sure what all the fuss is about. Full BBC Story
Seems Instagrams rules and terms of use are quite clear -
"You may not post violent, nude, partially nude, discriminatory, unlawful, infringing, hateful, pornographic or sexually suggestive photos or other content via the service."
That seems fairly self explanatory to me and if you don't like the rules then don't use the service - its simple isn't it?
We are a family friendly site and do not allow any "adult content" that may offend younger users, to the point that we actually turn away custom.
I don't think its censorship, there are plenty of other platforms one could use if you want to pose semi naked.