The big news story of the day, it seems, is that Twitter is acquiring Tweetie. You know, the popular (arguably the most popular) Twitter iPhone application? Yes, that Tweetie. The $2.99 app is going to be free from now on, and it will be renamed “Twitter for iPhone.” This stems from newbie users’ frustration and confusion when they search for an official “Twitter” app, only to find a mess of clients with unfamiliar names.

We’re thrilled to announce that we’ve entered into an agreement with Atebits (aka Loren Brichter) to acquire Tweetie, a leading iPhone Twitter client. Tweetie will be renamed Twitter for iPhone and made free (currently $2.99) in the iTunes AppStore in the coming weeks. Loren will become a key member of our mobile team that is already having huge impact with device makers and service providers around the world. Loren’s work won the 2009 Apple Design Award and we will eventually launch Twitter for iPad with his help.

So we can look forward to an iPad version of Tweetie, and possibly more frequent updates since Loren Brichter is joining Twitter’s mobile team.

One burning question has plagued exiting Tweetie users in the hours after the announcement: what will become of Tweetie for Mac? Good news, a beta of version 2 is sill on the way, according to an Atebits posting on the MacHeist forum. (Loren had previously promised buyers of the recent MacHeist bundle early beta access.)