Sorry but you are wrong. Twitter is Capitalism on the internet. It lets anyone compete and assumes the market will auto-regulate. Which is absolutely right. Although they let anyone use their API without much control, they know that if your app sucks, the market will not follow.
1. I wait until there are some clear Twitter client winners. I'd expect the market will diverge on a Killer Twitter client for each platform. Perhaps there's some alternate web interfaces with killer features, such that people stop using twitter.com.
2. I buy those twitter clients. I now control maybe 80% of the twitter client world.
3. I stop using twitter.com API as the backend, and replace it with my own.
4. Twitter.com becomes pretty much moot.
Maybe it's far fetched, maybe it's not...
Alternatively,
1. Wait until 3rd party twitter clients account for a large amount of twitter traffic - say 80%.
2. Do a deal between all the 3rd party twitter clients to stop using twitter, and collaborate on an alternate backend.
which is "a Free and Open Source microblogging platform. It helps people in a community, company or group to exchange short (140 character) messages over the Web. Users can choose which people to "follow" and receive only their friends' or colleagues' status messages. It provides a similar service to sites like Twitter, Jaiku, and Plurk."
I'm surprised no one has taken steps to avoid relying on Twitter.
2. I buy those twitter clients. I now control maybe 80% of the twitter client world.
Give me an example of one person or several people who came together and bought 80% of clients built around a successful API and then controlled that market?