I don't think this move, in an of itself, will doom Twitter, but it is just another example of why Twitter and its model aren't working.
The problem with Twitter is the same problem that plagues innumerable startups - they've built a product without even once thinking about the business model, and are not scrambling for revenue.
Inexorably, everything they do in the pursuit of revenue is going to involve making the product worse for users. Ad injection, loss of 3rd-party apps that support the ecosystem, all of that is just example after example of how a business with no built-in monetization will eventually cannibalize itself in the pursuit of revenue.
I'm not sure you can claim a company that is likely bringing in $540m in revenue this year and is expected to bring in $1b in 2014 not working. Or that it has no built-in monetization. Sure those numbers could be/likely are inflated, but there is still real money flowing to Twitter.
Obvious they may be "priced" at a higher valuation - but anyone looking to buy them is going to have to pay up - they are a rare commodity if they are hitting those revenue numbers.
Personally, I've expected this for a while and never understood why anyone would spend time on developing a client - unless you're developing something for a business to manage their social network. I am a bit surprised they don't just put some requirements on what clients have to carry in terms of advertising and that would be it.
Reality of the situation is that most 3rd party clients outside of Twitter probably aren't that big relative to people going to Twitter directly now.
The problem with Twitter is the same problem that plagues innumerable startups - they've built a product without even once thinking about the business model, and are not scrambling for revenue.
Inexorably, everything they do in the pursuit of revenue is going to involve making the product worse for users. Ad injection, loss of 3rd-party apps that support the ecosystem, all of that is just example after example of how a business with no built-in monetization will eventually cannibalize itself in the pursuit of revenue.