It uses that by default.
HTH.
As David mentioned, you can rename your app 'init' and get some of this to happen. It won't delete all mention of the app name, though--only when it can also delete the controller and function name.
If you don't want to change your app name, you can create (in web2py's base directory) a file named routes.py with nothing in it but this line:
default_application = 'myapp'
But to get the app name deleted on a more systematic basis, you'll need to write a more elaborate routes.py. There's a new version coming along, in beta in the trunk right now, that should be available for more general use pretty soon, so if you're not in a hurry, just go with one of the above solutions for now, and when the new rewrite logic is ready for prime time you can add a couple more lines in routes.py and be done with it.
If you're in more of a hurry, use the existing rewrite logic; it's not going away, but it's a little trickier to set up.