Chicken and egg: short videos can still be kind of bearable when amateurishly produced, the length limitation serves as guiderails. Now that much of the content consumed on Instagram is thoroughly professional, they can open the limit. Did anyone else notice how the announcement doesn't include a single line about how users would create those longer videos?
Launching a 1 minute video platform is much easier than building a live streaming platform, and maybe it wasn't the right time for them to launch a live recording platform or would have hurt some of their other ambitions?
The abilities of a feature complement its positioning to users. I would imagine that the limited 1 minute videos are in the main Instagram app, where they would likely want to retain the feel of Instagram, which wouldn't work well with long form content. Now IGTV might be their play for long form content. Sure, both are video, and both are from Instagram, but two very different ways of positioning video, for different purposes, in different places, targeting different people.
