The article agues that while they serve different purposes, there is still only so much free time each person has in a day. Both, Twitter and Facebook, are in competition for this free time and from that perspective you can compare them directly.
I only have so much money, but Nabisco isn't competing with Intel for my cash except in a coarse, weird and not-very-useful sense. If Twitter and Facebook fulfill different social needs, then they aren't in competition for the same free time.
Yes and no. In this case you assume you have enough money to spend on both, but if you are on budget then if you buy expensive intel product then you have less money to spend on Nabisco and vise versa. In this situation instead of money it's time. Twitter and Facebook audiences intersect so they are directly competing for attention. Amount of ads you get exposed to depends on how long you spend on the site. The more time you spend on Facebook = less time you spend on Twitter = less ads Twitter can show you = Twitter make less money.