On one hand, Twitter probably needed to do this because there’s clearly demand for it.
On the other hand, it’s hard not to see it as a mediocre attempt to clone and hurt Instagram, especially given their rocky relationship in which Twitter appears to be the bigger aggressor.
But it would be a serious strategic error to assume that Instagram is primarily about filters. Instagram is a massively successful photo-sharing social network that offers filters as a nice touch. Twitter implementing filters will probably hurt Instagram as much as Windows hurt OS X by introducing translucent window chrome in Vista.
So I hope hurting Instagram wasn’t the reason Twitter made this move.