AOL have revised their Terms of Service to replace that wording that had everyone in such a kerfuffle, and it’s a lot better.

They’ve replaced the Orwellian "You waive any right to privacy" section with a much more reassuring statement, quoted below:

As explained in detail in the AIM Privacy Policy, AOL does not read your private online communications when you use any of the communication tools on AIM Products. If, however, you use these tools to post Content or other information to public areas on AIM Products (for example, in chat rooms or online message boards), other online users will have access to this information and Content.

Their privacy statement referred to above says (amongst other things):

AOL does not read your private online communications when you use any of the communication tools offered as AIM Products. If, however, you use these tools to disclose information about yourself publicly (for example, in chat rooms or online message boards made available by AIM), other online users may obtain access to any information you provide.

So well done to AOL for clarifying this so quickly, but it’s a shame it happened in the first place.

They do still claim that if you post to a public area then you are allowing them full licensing rights, viz:

You or the owner of the Content retain ownership of all right, title and interest in Content that you post to public areas of any AIM Product. However, by submitting or posting Content to public areas of AIM Products (for example, posting a message on a message board or submitting your picture for the “Rate-A-Buddy” feature), you grant AOL, its parent, affiliates, subsidiaries, assigns, agents and licensees the irrevocable, perpetual, worldwide right to reproduce, display, perform, distribute, adapt and promote this Content in any medium.

But that’s easily fixed by not posting to them in the first place!