If i really want to keep in touch with far-flung family, friends - i pick up the phone or drop an email. If they are important to me i will make the effort. I also don't find the need to advertise on a daily/hourly basis what i am doing or tell people about the cool car/bike/tv/ipod etc. i bought. May be its just not for people like me.
Things you suggest - picking up the phone, dropping an email - require 1-on-1 contact. I am limited in the amount of time I can devote to 1-on-1 contact.
But I can post on Facebook and people that know me but aren't necessarily people I want to devote a lot of 1-on-1 time to - more distant relatives, old friends, etc. - can see what I want to share. And I can skim my feed and see what they want to share.
The level of time and contact is proportional to the relationship. They're not my inner circle, they're outer circle. Facebook is the single best improvement to my "outer circle" relationships ever invented. For low effort, I get to have some contact instead of no contact.
For some people, Facebook is all about the time wasting activities, but that's not the core of the experience unless you make it so.
It's a great way to share photos. It's also an ad-hoc mailing list between you and your friends. Post what you want; it's literally up to you. I post photos and links to interesting stuff -- mostly nerdy but my friends aren't terribly surprised by that.
That's it. Seriously, it's not calling you at home and asking what you're doing every hour. You make it what you want.
People like to talk about their lives. You may not care, but it's no different than normal smalltalk.
"It lets you keep updated on what your aquintances does on a daily basis". Not your good friends (because you call them). Not your collegagues (because you chat/mail them). But all those highschool and childhood friends you dont see on a day-day basis because they're in another country/region/world/whatever.
Now, I could argue that that information is quite, uninteresting, and in many ways, it is. It is however quite nice to know that if I want to reach those people, I can.
It's not about keeping in touch. It's about hanging out and gossipping.