Ahmet Ali, 30, from Tulse Hill, south London, was jailed for two years.
The paedophile ring - called The Wonderland Club - was smashed by Operation Cathedral, the largest international operation to be co-ordinated by the National Crime Squad in London.
But child rights groups in the UK described the sentences as a "joke" that suggested the crimes were not being taken seriously.
Under laws applying at the time the men were charged, they could only have faced a maximum of three years in jail.
Passing sentence at Kingston Crown Court, Judge Kenneth Macrae told the seven men: "You directly or indirectly exploited the most vulnerable in our society. Children represent the future. They should be cared for and protected."
He said that despite "pandering to the basest interests of man" they had to be given credit for pleading guilty to conspiracy to distribute indecent images of children.
Police say the jail terms were a victory, adding that a Bill had now been passed in Parliament increasing the maximum sentence to 10 years for such offences.
Sentences condemned
But the director of child protection charity Kidscape, Dr Michelle Elliott, said: "You would get a longer sentence for accumulating masses of parking tickets or for burglary.
Detective Chief Inspector Alex Wood said the sentences were as police expected as the judge was working under constraints where he had to give credit for guilty pleas.
But he said their ground-breaking investigation had brought forward changes in policing of paedophiles and legislation around the world including the UK's tougher stance.
"Paedophiles appearing in court today will receive much more severe sentences because of this legislation," he said.
Convictions
Ian Baldock, 31, from St Leonards, East Sussex was jailed for two-and-a-half years.
Antoni Skinner, 36, from Cheltenham, Gloucestershire was jailed for 18 months.
Gavin Seagers, 29, a Sea Cadets youth leader, from Dartford, Kent was jailed for two years.
Ahmet Ali, 30, from Tulse Hill, south London, was jailed for two years.
Frederick Stephens, 46, from Hayes, west London, was jailed for a year.
Andrew Barlow, 25, from Bletchley, Milton Keynes, Buckinghamshire, was jailed for two years.
David Hines, 30, of Bognor Regis, West Sussex was jailed for two-and-a-half years.
Baldock and Hines were placed on the sex offenders register for life because of their greater role in the gang's crimes. The others were ordered to be kept on the register for seven years.
International operation
The operation resulted in a total of 107 arrests in the UK, Australia, Austria, Belgium, Finland, France, Germany, Italy, Norway, Portugal, Sweden and the United States.
The defendants' homes were raided on 2 September 1998 and an enormous amount of pictures were uncovered as well as computerised videos depicting children suffering degrading sexual abuse.
All of the children involved were under the age of 16 and in one case the child was only three months.
More than 1,263 children were featured in the pictures - but only 17 had been identified - six in the UK, seven in the United States, one in Portugal, one in Chile, and one in Argentina.
An album of the children involved has been created and posted on Interpol's website to help police forces from around the world trace the victims of abuse.