Strategically I am missing why Instagram is even viewed as a threat to Facebook. It seems like a complementary service. If Instagram tried to go the route of forcing you to be a member and only share photos with other Instagram users, nobody would use it. Facebook and Twitter provide the platform for Instagram to exist.
Probably because Instagram could ease users' transition to another social site. If something like Google+ hit it off with everybody and they could move all of their pictures with the press of a button and keep their Instagram UI, that lowers the barriers of entry for people to come along and steal FB's cake.
