Many years ago, there was a program for the Mac called Conflict Catcher. Basically, it helped you troubleshoot problems with the pesky “extensions” that loaded during startup in older versions of the Mac OS. The extension system itself was a mess, so this program was a must-have for Mac users. Conflict Catcher addressed an important need for its customers, and I believe they sold a bunch of copies.

However, I don’t think the company that made Conflict Catcher even exists anymore. What happened? Well, Apple clearly knew about the problem with the extensions system, and eliminated that issue in Mac OS X. As customers upgraded to the new OS or bought a new Mac, they no longer needed to buy that program. The same problem that made customers want the program so much also provided the impetus for Apple to fix the underlying issue.

This is the paradox of creating a solution for someone else’s problem. The more customers who want the solution and the better you do and the more you sell, the greater the motivation for the other guys to sit down and fix the real cause of the problem. Your own success puts a spotlight on how badly customers want the problem to be fixed. And before long, the original issue gets addressed, and nobody needs your solution anymore.

I see the same thing happening with the hundreds of services that add little bits of functionality to Twitter and other web-based applications. Twitter can easily pick the best ones, integrate that functionality into the main product, and eliminate the need for the third-party solution. Maybe that’s not their intent, but maybe it is. Either way, Conflict Catcher and other utilities of yesteryear are great examples of why you should be very cautious about building a business that someone else could wipe out by simply fixing their own issues.