Everyone needs to read this.
While I appreciate that businesses are in existence to make money, things like Reddit aren’t strictly a business, like your local grocery store, for instance.
The grocery store has employees, products, and creates its own products (bakery, deli, etc) by paying its employees to do so. They do NOT rely on non paid, non employees to generate the ENTIRETY of the “product” that makes them exist. They pay taxes, employees, rents, vendors, etc. in other words, overhead.
Reddit relies solely on non paid, non employees to create, maintain, and expand things that, while intangible, make Reddit exist. Reddit itself doesn’t create anything people go there to see. They just provide the infrastructure.
So all that being said, yeah, sure, Reddit should be able to at least cover their limited costs, without issue. That’s not what Reddit is talking about though. Reddit it talking about destroying the things (3rd party apps) and people (mods and users) strictly for, what they see as huge profit (IPO).
This is like when there were a bunch of really great forums, and then IB started buying them all. Immediately they went to shit, and have pretty much all been left to rot, if they are even still hosted. A lot of magazines went through the same thing too, at least in the car community. Profit over everything, and then inevitable failure.
Ok, and what would you do instead? How would you keep a forum up and running and able to sustain itself? To me, pointing out that things are bad and could be better is an extremely obvious observation. The interesting question is, how do you make it better?
Firstly, if Christian’s numbers are accurate, and a user costs Reddit $0.12 (doing this from memory so my numbers might be off), and Reddit is proposing each user costing third party apps $2.50 then that’s the first place to start. You could charge the 3rd party apps $0.50 and everyone would be happy. $0.38 doesn’t seem like a lot, but when you factor in the volume, then it’s a lot. Even if they needed to be greedy, $1 per user. FFS CEO asshat praise Elon musk’s cost cutting/business sense. I’m pretty sure we all know what that means by now (the trump approach. Just never pay anyone what you owe them, contract be dammed).
Third party apps don’t have ads. Or at least not reddits ads. Ok. Fair enough. I am pretty sure there’s a way to pass that onto the 3rd party apps too. And then the third party apps can charge a premium fee to remove ads. That said I’m not a programmer so I don’t know how it works well enough to say unequivocally.
Those two things would have curried a lot of good will with users. The thing that Reddit, and all the other apps/forums before them, have failed to realize is that yes, you’re a business, but that business is built on people WANTING to engage with your servers in the first place. If there’s Jo good content, because all the real content creators left, you don’t have shit, no matter how much you charged (twitter looks like a good modern example). Also like to point out that Reddit is as much guilty as he’s accusing the 3rd party apps of using api to make a profit. All those news articles, videos, pics that come from other places probably aren’t being paid for my Reddit. That’s easily 1/3 of their content or more (probably more like 1/2-3/4).
The issue is that what Reddit isn’t saying out loud, yet, is that YOU are the product. Your info IS the product. They don’t give a shit about user experience, or content creation or that third party apps exist, frankly. It’s that THEY don’t have control of, and sometimes don’t have any of, your info. That’s the real money maker.
Reddits reaction tells us a lot. First it was that we are noise, and it’s a storm, and it’ll pass. Now it’s fuck you I’m in charge. You’re going to do what I say and like it. Even discussing removing mods is a losing proposition. Not immediately but Reddit is going to change for even worse. The user experience that ceo is claiming he’s trying to improve is going to take a VERY sharp nose dive very soon.