A popular website used by sellers on auction sites like Amazon, Etsy, eBay and Gumtree is facing a growing backlash for effectively demanding a “ransom” from its members.

Photobucket, an image and video hosting website founded in 2003, quietly changed its policy late last month to prevent users from hosting their content on third-party websites unless they pay a $400 annual fee.

Members who used the previously free service to store their content for use on auction sites, blogs, and internet forums have discovered their images replaced with a message asking them to “update your account.”

No warning was given, but the company posted a brief blog post on June 26 announcing an “update to our terms of service,” with the change buried towards the end of the article.

The move means more than a decade’s worth of images hosted all over the internet have suddenly turned into broken links unless members sign up for one of Photobucket’s “competitive subscription plans.”

“Photobucket have killed the internet … Well done,” wrote Twitter user Wevsky. “I want to know why you think it’s cool to destroy a decade worth of posts on many forums and expect people to be held to ransom for £399.”

Andrea H. tweeted: “Soooo angry! I have five years of blog posts that are ruined now.” Evelien added: “My blog looks like s–t. Thousands of articles — SEVEN years of work.”

Colin Graham wrote: “Congrats on successfully committing corporate suicide. Wouldn’t it have been less messy to simply shut down altogether?”

Twitter user Spammals described it as “how to destroy a business overnight.” “Even if you revert the change it’s too late,” they wrote. “The damage is now done and it grows worse every second.”

Many likened it to recent ransomware attacks which lock victims out of their own computer systems until they pay up. “Anyone else surprised Photobucket isn’t offering Bitcoin as the only method of payment?” asked Twitter user McMike.

User Superfuture wrote: “We now have 3.2 million forum posts from 2003 littered with your ransom images. This has to be illegal. Hello all class action lawyers.”

Stefan Bosman tweeted: “Thank you for all the good years I’ve had with your product. Now deleted my account due to the $400 blackmail. Good way to go out of business.”

Photobucket, which claims to have more than 100 million members and 15 billion hosted images, has not responded to the growing backlash save for a few tweets.

“Thank you for all of the recent feedback and questions,” the company tweeted on Sunday. “We are trying our best to respond quickly and thank you for your patience :).” A day earlier, it tweeted: “Want to know more about 3rd party hosting? Check out our FAQs.”

UK-based vintage store Retro 2 Go, which sells goods on eBay, was one of those affected. “I have quite a bit of editing to do,” the store’s owner told the BBC. “A bit of notice would not have been unreasonable to expect. I have deleted my accounts and would not use [Photobucket] again.”

On Reddit, one user wrote that while Photobucket was “absolutely entitled to change their business model whenever they feel like it”, the way the company handled it would “go down as one of the great customer-service f–k-ups in internet history.”

“Folks, you’re witnessing the death of an internet business,” another user wrote. “This is the kind of screw up a company never really recovers from.”

Another wrote that “you can’t even begin to imagine what this will mean to internet forums and blogs”. “Older internet users remember what a dumpster fire the internet was when Angelfire, Geocities, and Tripod stopped offering free hosting,” they wrote.

“Broken links everywhere and it was the exact same cause, they started out to give everyone free hosting, but they reached critical mass as more people signed up for the free than the paid.”

In a blog post, marketing firm Aqueous Digital described it as a “case study on how not to do it”. “Not only did they dump this on their users with zero notice but they are compounding the issue with their communications, or lack of them,” the company wrote.

“From a commercial point of view, there must have been a growing imperative to step away from a model primarily reliant on advertising. With a growth in customer numbers and an increase in bandwidth usage, their cost base must have been spiraling. It’s a byproduct of their success.”

“The solution however surely was not what they have come up with? Firstly, why make the change with no notice? Why simply change overnight and then dump on your customers? Secondly, how on earth did they arrive at their pricing point? When so many people use their service specifically for third-party hosting and nothing else, why provide this service only at the highest price point you have?”

Photobucket was acquired by Fox Interactive Media in 2007, but in 2009 was sold by Fox parent company News Corp, publisher of news.com.au, to Seattle-based mobile startup Ontela.