yes. if instagram started performing intensive JPEG compression that made photos choppy and unpleasant, I would consider that an intentional degredation of the software.

Is default enabling JPEG compression to your software's output because the compression saves you money “intentional degradation” of the software?

I would say it does, and I'd loathe to use anything made by people who'd couch that change to defaults as "providing a selectable option to use a faster, cheaper version".

Yuck.