The news came this weekend that Twitter has agreed to acquire Atebits, the cleverly named company behind Tweetie, a Twitter client for Apple's iPhone and Mac platforms. This is a huge step, and a glaring indicator, for Twitter as a company—how it'll manifest itself for Twitter the service isn't quite so clear.
Fred Wilson, a major investor and director for Twitter, hinted last week that Twitter was about to start "filling the holes" in the service. Third-party services, he says, sprung up around Twitter out of necessity: you needed search, you needed a mobile app, you needed a URL shortener, and you needed an image uploader. None of that came in Twitter, and until now, the company was content to let developers fill those gaps.
But not anymore. Twitter bought startup Summize back in 2008 to create a decent search engine, and now they've acquired Tweetie, one of the best (if not the best) mobile Twitter app. A URL shortener (like bit.ly) and photo uploader (like Twitpic) could well be next. And if Twitter does acquire all the necessary components and offer them as a package, they'll have total control of the medium, which means they'll be able to monetize much more effectively. That strategy will also, of course, leave all the developers who made Twitter what it is today stranded.
Twitter plans to offer Tweetie free, down from the $2.99 it previously cost in the App Store. That makes two official Twitter apps—BlackBerry just got its own this past week—leaving Android, WebOS, and Windows Mobile with third-party apps for now. That doesn't matter much at the moment (although Tweetie for free is a nice deal), but with their own mobile client, Twitter would be able to provide whatever updates or features they want.
We should find out more about what Twitter plans to do with Atebits beyond just making Tweetie free, as well as how the company plans to, you know, make money off of the service, at the Twitter event Chirp, this week.