Instagram was starting to cannibalize the facebook youth userbase. Instagram worked its way into people's minds, vocabulary, and daily habits. The acquisition was a defensive maneuver by the paranoid Kid in Chief.
Another survey, this one from December and including all Americans (not just teens), showed people spend more time on Tumblr than Twitter, Pinterest and LinkedIn combined:
Well, nobody knew (or knows) how big instagram will get. Tumblr has already peaked. Also, tumblr is too anonymous to be of any value to facebook. Not much to exploit there. I don't think forcing Real Name™ upon every tumblr would make for a happy Internet.
Photo sharing is said to be core to what Facebook users value.
I see Instagram as a defensive acquisition -- they don't want to lose market share to a competitor. It took Instagram only two years to reach 100 million users.