I said this elsewhere, but almost all of the articles (Verge excepted) miss the larger points. Someone coming in cold with no sense of the context here could easily walk away with the idea that Reddit is behaving reasonably (e.g., why shouldn’t they charge for API usage? they’re a company trying to make money!) and users and mods are completely out of control. These articles rarely address the concerning accessibility issues being created by the API changes. They rarely address the price to be charged is vastly larger than the price that it costs to provide API access/recoup losses from inability to advertise to 3P users. They don’t address the fact that the changes were announced with barely any lead time to allow 3P apps to make necessary changes on their end to avoid insane fees. They don’t cover the damage to mod tools or the fact that the moderators are working for free and occasionally working at a loss (due to purchasing their own servers, for example). They also don’t address the fact that Steve Huffman pointedly lied about Christian Selig threatening to blackmail Reddit, that he doubled down on this in his AMA, and that if you sift through his c&p statements, he doesn’t actually answer questions or provide any kind of information or reassurance. It’s all very annoying.
And this isn’t even strictly true. Reddit could have given 3P apps the option to pay a reasonable price for the API, or they had to serve Reddit’s ads to avoid paying the fee, it would be a fair compromise.
It sounds to me like Reddit can’t profit from ads, even if the 3P apps served them. If that’s true, Reddit is doomed, and investors will see that as they approach the IPO.
I said this elsewhere, but almost all of the articles (Verge excepted) miss the larger points. Someone coming in cold with no sense of the context here could easily walk away with the idea that Reddit is behaving reasonably (e.g., why shouldn’t they charge for API usage? they’re a company trying to make money!) and users and mods are completely out of control. These articles rarely address the concerning accessibility issues being created by the API changes. They rarely address the price to be charged is vastly larger than the price that it costs to provide API access/recoup losses from inability to advertise to 3P users. They don’t address the fact that the changes were announced with barely any lead time to allow 3P apps to make necessary changes on their end to avoid insane fees. They don’t cover the damage to mod tools or the fact that the moderators are working for free and occasionally working at a loss (due to purchasing their own servers, for example). They also don’t address the fact that Steve Huffman pointedly lied about Christian Selig threatening to blackmail Reddit, that he doubled down on this in his AMA, and that if you sift through his c&p statements, he doesn’t actually answer questions or provide any kind of information or reassurance. It’s all very annoying.
And this isn’t even strictly true. Reddit could have given 3P apps the option to pay a reasonable price for the API, or they had to serve Reddit’s ads to avoid paying the fee, it would be a fair compromise.
It sounds to me like Reddit can’t profit from ads, even if the 3P apps served them. If that’s true, Reddit is doomed, and investors will see that as they approach the IPO.