I don't think it's necessary to be off it, but I do believe it's necessary to be intentional how you use it and aware of how it impacts you. For my own part, I don't share updates about my life anymore and I now ignore updates from my close friends. This came after the realization that Facebook had become a substitute for small talk when we'd meet up. "How've you been?" and "What've you been up to?" started feeling like unnecessary questions when we already knew the answers. But what took longer for me to realize is that that kind of small talk was a lead in to deeper, more meaningful conversations. And when we stopped going through small talk exercise, we didn't get to those more important conversations nearly as often and it impacted how connected I felt with friends. Since that realization, I've started being intentional with how I use Facebook to avoid the sharing of those seemingly insignificant details between me and my friends and my relationships have all improved.
And that's what I see as Facebook's biggest problem. Humans are complex animals that have complex interaction patterns. Facebook is, for better or for worse, altering those patterns, and not always for the better. We need to be very aware of what we're losing when we choose to let Facebook do that to us.