I don't think Twitter should be concerned unless someone builds a better product.
Which is inevitable. Their clients are crappy, otherwise there wouldn't be a third-party ecosystem to piss off in the first place.
Which means their only defense is network effects.
Which means it's probably a bad idea to motivate all your early adopters to find and grow the network that unseats you.
Take a look at the Twitter trends list if you want proof that Twitter caters more to "normal people" than it does "technology" people, here's the #1 trend as I type this: http://twitter.com/#!/search/%23NameATurnOn
Yes, their only defense is their network (which is, in my opinion, their "product"), but the majority of their network is not going to leave because of their developer relations. Twitter are safe as long as an alternative doesn't exist and they provide value to their users.
Twitter aren't stupid, they're not going to be enacting this plan if the majority of their users use third party clients. I suspect the majority of people that do use third party clients are those using "value adding" third party clients, like Hootsuite, and those that use Hootsuite are the people that get value from Twitter's network (for example marketing people) so if Hootsuite shuts down they're not going to quit Twitter, they're going to move to an official client.
If your client annoys people too much, they'll move on too. Nullsoft learned that the hard way with Winamp 3. Gnome may be in the middle of that lesson right now.
> Twitter aren't stupid
Oh come on, that's not an argument. There have been countless examples throughout history of companies (in tech and otherwise) that have done stupid things that have directly contributed to their demise. There's no reason to assume that Twitter won't end up like them.
This will inevitably decrease the amount of "normal people" as active users.
Twitter is run by people, and sometimes people make decisions which are, either at the time or in hindsight, stupid. The argument that companies won't do something because it will damage them has been proved wrong so many times in the past.
I'm not saying that this particular decision is stupid, but the idea that companies always act in some kind of enlightened self-interest make the right decisions to do so is just plain wrong.