One of my pet peeves about Twitter is that conceptually, it hasn't embraced the fact that most of its users don't Tweet by SMS.

I'm all about using a restricted message format to encourage spontaneity and focus the message, but if I want to @reference more than like three people I have very little room for what I want to say - and if I have a URL as well, I have almost none.

Keep the system as-is for SMS-based tweets, but for the rest of us don't count @names or URLs in the message length.

So what happens to the "unrestricted" tweets when they're received over SMS?

Send them as two sequential SMS messages, or an MMS message (user's choice). Pretty much anyone who is receiving tweets on their phone has unlimited received texts anyways.

The same thing that happens to DMs. They get split up.

Twitter should treat urls, @reply, #hashtags, geographical descripters, etc as a separate metadata field outside of the message.

Agreed. Similar to what they're doing with ReTweets, or at least are rumored to be doing. (showcasing the original tweet in your followers' streams and just saying who it was retweeted by)

There is also a huge benefit to developers if they separate the stuff out - no more parsing tweets for mentions/hashtags because there's a separate field for them as well as possible fields for other info.

http://news.com/And-What-If-I-Start-To-Encode-My-Message-In-...?

The anchor text would still count against the message length, but the href would not. Just have some simple syntax, like markdown's [text](url)