Twitter CEO, Evan Williams, laid out the rationale for the acquisition pretty clearly:
"Careful analysis of the Twitter user experience in the iTunes AppStore revealed massive room for improvement. People are looking for an app from Twitter, and they’re not finding one. So, they get confused and give up. It’s important that we optimize for user benefit and create an awesome experience."
There you have it. Interestingly, earlier this week Fred Wilson said that he wanted developers to stop building apps that just patched holes in the core offering and start building apps around various vertical industries or striving for that "killer app". Well, Tweetie is a "fill in the gap" app. I would say this was Twitter's shot at developers saying they mean business; "Build killer apps or we will continue to marginalize you."
But what is the revenue model for Twitter app developers to develop the "killer app"? To this point, that isn't clear yet. New developments between Twitter and the development community will be interesting to watch over the near future.