Twitter doesn't want you to build a twitter client that automatically filters out ads in the twitstream, or doesn't have ads on the sidebar like the official client, or in some other way is superior to the official client.
That is, Twitter is planning to monetize by making their product worse, and they don't want anyone offering a service on the level of what Twitter used to offer.
What is particularly galling is that Twitter has been saying for years that they want to monetize without slapping ads over everything. Now they're monetizing by... slapping ads over everything. And ensuring that no one can threaten the business model they supposedly didn't want to use.
All of this would have been better had Twitter just started off by slapping ads on their service and making it clear how they were going to protect it. Instead, they've grown their userbase (at least among the technorati) by asserting that they weren't going to pursue the exact model they seem so ardently chasing now.
Sure, 3rd party app devs might be "suckers" for having latched on early, but I don't think that excuses Twitter for such a (to use a Gruberism) dick move.
People love useful, friendly accounts on Twitter. My wife and I built up a community of 250K followers just by following that simple formula. If Twitter had a several useful, friendly accounts that every user was forced to follow, they could run the occasional ad, if no single account overtweeted.
While there is no proof that this would achieve a required level of success, had Twitter been doing it for years, they would have learned a ton, and made a lot of money.
Using Twitter accounts to connect to their community and run ads could still be tried, and a level of balance found. (They can respond to inquires from a separate account that accepts no followers so it's replies don't show in anyone's timeline.)
That is, Twitter is planning to monetize by making their product worse, and they don't want anyone offering a service on the level of what Twitter used to offer.
IMO if they have to add some inconveniences to their product to make some dough, I have no problem with that. They have a company to run and sometimes you have to make hard decisions.
I just wish they were more upfront about it than their present passive-aggressive demeanor.
The galling thing in this, is that much of the innovation that happened on the client side was initiated by 3rd party developers. Applications like Tweetie, Birdhouse, Twitterific, etc. probably wouldn't have sprung up inside Twitter.
That is, Twitter is planning to monetize by making their product worse, and they don't want anyone offering a service on the level of what Twitter used to offer.