If Twitpic is its own separate entity from Twitter, how do they work so seamlessly together? It's all thanks to something called an Application Programming Interface (API), which Twitpic uses to interact with Twitter. An API is a set of programming instructions, rules and specs that create an open architecture to allow sharing between Web-based software applications. Essentially, it functions as a go-between for two different pieces of software. We use Web sites all the time that have multiple APIs, operating behind the scenes to ensure a seamless user experience. Whenever you order something from a store online, for example, your credit card information is sent via API to another application, which ensures your information is correct. That application responds to the store Web site to let it know that it can go through with your order. All you see is the end result -- confirmation that your order was received.
Companies share their APIs both as a way to create a better experience for users and to make it easier on software developers. Instead of having to design their own applications to perform the Web site's services, those services are contracted to other companies. Twitter's API is publicly available for developers to create third-party Twitter apps; this is how Everett was able to quickly and easily invent Twitpic. In turn, Twitpic's API is also publicly available so that other applications can interface with it. This is how you're able to use Twitpic via third-party Twitter apps to share photos.
Twitpic started out with just one server to store photos and associated data, but as the service grew, it quickly became flooded with API calls (the term for when the API sends instructions to the service). Today, multiple servers field millions of requests every day (from the more than 20 million registered users), employing caching to make load times faster. Sometimes, Twitpic still can't handle all of the photo uploading and viewing, however, and has experienced server crashes during events such as protests.
In June 2011, Twitter announced that it would be partnering with Photobucket to create its own photo-sharing service, continuing a trend to control more of the services that had been previously dominated by third-party developers. Who knows what this will mean for the future of Twitpic?