I'm a little surprised so many machines are used to run Instagram. TechCrunch mentioned their peak has been 50 photo uploads per second (which they say go directly to S3, so Instagram's servers only need to pass a token). Of course there are other forms of requests, but just back of the envelope it seems like it should not require anywhere near "hundreds" of machines.
Not to be too harsh - it's just three engineers, so it makes sense if the setup is still evolving.
I was surprised they had so few... I once worked on a site with 1/6th the users and 3.5 times the number of instances.
They could do better but they'd have to manage their own datacenter and write portions of the app in C++. It's probably not worth it at this point unless they hire someone with that specific expertise.
I once worked on a site with 1/6th the users and only one machine. ;-) Counting users often doesn't match across sites, especially when an Instagram user is someone who has downloaded the app, and might never come back. That's why the 50 photo uploads per second peak is a useful benchmark.
Not to be too harsh - it's just three engineers, so it makes sense if the setup is still evolving.