Facebook's response to Google+ actually took place last summer and last fall. I was an intern there at the time, so I got to see it. Google Me, as it was known at the time, was clearly Google's first serious attempt at moving into social, and everyone was a little bit nervous. So, Zuck declared "Lockdown" for sixty days. "Lockdown" was a term from Facebook's early days, which meant when they had a serious competitor…
Was the new photo viewer really looked at as a "feature" by facebook staff? It seemed to me like it was facebook's way of saying "we're sick of being a free image host".
You'll notice that Google+ has the same type of viewer.