Reddit on New Pricing Plan: Company 'Needs To Be Fairly Paid' (bloomberg.com) 145
A number of Reddit forums plan to go dark for two days later this month to protest the company's decision to increase prices for third-party app developers. From a report: One developer, who makes a Reddit app called Apollo, said that under the new pricing policy he would have to pay Reddit $20 million a year to continue running the app as-is. Reddit's move comes after Twitter announced in February that the company would no longer support free access to its application programming interface, or API. Twitter instead now offers pricing tiers based on usage. Reddit spokesman Tim Rathschmidt said the company is trying to clear up confusion about the change on the platform, and stressed that Reddit spends millions on hosting. "Reddit needs to be fairly paid to continue supporting high-usage third-party apps," Rathschmidt said. "Our pricing is based on usage levels that we measure to be comparable to our own costs." The company said it is committed to supporting a developer ecosystem. In a post on its platform, Reddit laid out some of its pricing plans for businesses and said the changes would begin July 1.
Why not have a shared ad revenue model? (Score:3)
Re:Why not have a shared ad revenue model? (Score:5, Insightful)
Easy enough.
Re:Why not have a shared ad revenue model? (Score:5, Interesting)
Exactly. As James Stephanie Sterling continues to say, "They don't want just some of the money. They want all of it."
Re:Why not have a shared ad revenue model? (Score:5, Insightful)
Cory Doctorow created a term for this when it comes to online services: "enshitification". This is nothing new, it's merely Reddit's turn.
Doctorow's original essay [pluralistic.net] is well worth reading.
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I wonder what percentage of Reddit users block ads.
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You can count me in that percentage. Of course I don't block them based on what app is being used; I block based on DNS at the network level so it dumps ads on any device and any service.
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What do you use for that?
Until a few years ago, I used a cron job to snarf the MVPS list and build BIND zone files out of it, but that's dead now and updating the blocks manually is getting obnoxious. I tried looking for pihole's lists, but it looks like it uses a bunch of the adblocker regex-based filters, rather than just domain filters.
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AdGuard makes a convenient docker container image that contains a DNS server, and a UI for configuring the service, and automatic updating of multiple blacklists. Read more here. [github.com]
Or, if you're lazy, here's the docker-compose yaml I use:
version: "2"
services:
adguardhome:
image: adguard/adguardhome
container_name: adguardhome
ports:
- 53
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Like everywhere else: Everyone who knows how to and can.
Re: Why not have a shared ad revenue model? (Score:2)
Brave + old.Reddit.com cares for most of them.
Re:Why not have a shared ad revenue model? (Score:5, Insightful)
But the first thing you should do is fire the idiot UI/UX developers that turned the site into such a pile of crap that people will seek out third party apps in the first place.
Re:Why not have a shared ad revenue model? (Score:4, Informative)
The website is fine, great even.....especially when compared to this dinosaur that is Slashdot. It's the Reddit app that is hot garbage.
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The website is fine, great even.....especially when compared to this dinosaur that is Slashdot. It's the Reddit app that is hot garbage.
Yup and unlike Slashdot, Reddit supports:
- UTF8
- Curly brackets
- IPv6
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The website is fine, great even.....especially when compared to this dinosaur that is Slashdot. It's the Reddit app that is hot garbage.
It's not just the app, it's the tools and functionality provided for people to actually maintain their subreddits in the first place. That's the reason moderators are protesting this change. They don't want the additional work that comes with having to deal with the damn shitty first party reddit tools.
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Defined "well organized" and "handles spam well"? Literally every post has at least one comment with the word nazi or the N word in it.
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fits my usage patterns.
This is the important bit. I find Slashdot to be difficult to read and to manage. Simply being able to collapse comment threads would do wonders here.
As for the censorship, I would prefer not to have to see comments from idiots like that each morning. And how can one "burn in the sun" when they're posting anonymously?
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well, i wonder what the next thing is.... digg did (Score:5, Informative)
not the same order of magnitude (Score:2)
That is why the situation is different, and I think reddit is quite safe in their decision. Now it COULD change given time, but right now as of 6/6/2023 : they are safe.
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digg had a few millions user. They easily switched out as many alternatives and social media cropped up. Reddit has something like 400 millions active users. There are NO existing alternatives today which even has 1% of that numbers. There is no way an alternative would gather 100s of millions of people of growth quickly.
That is why the situation is different, and I think reddit is quite safe in their decision. Now it COULD change given time, but right now as of 6/6/2023 : they are safe.
Myspace had 115 million users. After just one year, Facebook surpassed it in visits. The value of reddit is not in its collection of past discussions but rather its current discussions. All these sites have the same characteristic of having their value lie in current posts having far greater value than archived posts. So, when the current posts move somewhere else, the value of the archived posts can't save the site. Reddit does not have a protective moat.
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Myspace had 115 million users. After just one year, Facebook surpassed it in visits.
It wasn't just one year. Myspace started in 2003. It peaked at 115mil in 2008. Facebook started in 2004, and hit 115mil in 2008. So, really, this just reinforces their point that there needs to be a large enough competitor for people to migrate to.
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You mean like Twitter did?
After Daddy Elon bought it, EVERYONE said people were going to migrate to other platforms like Mastodon. EVERYONE knew Twitter would immediately collapse on itself because of all the changes, paid checkmarks and whatnot and they would rollback all changes soon.
And here we are. They didn't do jack shit, Twitter is still numero uno and EVERYONE who was certain it would fall on its face went back to it with their tail between their legs.
Re: well, i wonder what the next thing is.... digg (Score:2)
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I know you really want people to believe that, but virtually 100% of them were banned for nothing interesting whatsoever, just really tame stuff. Some of them were doctors saying stuff we accept as true to day, like masks are not necessary outdoors.
In fact, the old Twitter board claimed such bans were few and far inbetween, but then lied about the existence of shadow bans and view suppression of tens of thousands, including those of many elected Republican officials. Many thousands were banned based on li
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Its revenue is down a lot, but so are its costs, and its user base is about the same. I don't use much social media, certainly not Twitter!
You guys keep saying "it's dying," but you said it was on the verge of collapse for months, too, and it never did. And now Musk is transferring control to a new president. Apparently things are under control. "Nazis" and "racists" did not take control, despite your hysteria.
Arguing a strawman... (Score:5, Interesting)
While free is appreciated, even the most notable person in the "WTF Reddit?" said they pay other services for API calls. However, Reddit's proposed pricing is 20000% higher than a comparable service.
Of course, this all smells of making their community accept a significant pricing scheme in the end, by starting with an unreasonable opening to make the final 'compromise' feel like a win.
Re:Arguing a strawman... (Score:5, Informative)
At the end of the day, this is the natural consequence of capitalism and the current view of the purpose of business being to maximizing share price.
If Reddit were willing to accept the profit it makes today and grow as the user base grows, it could continue as the "front page of the internet" more or less indefinitely. With google doing everything it can to ruin search, Reddit has become the go-to place to find help. Even if google finds the right result, more than half the time I'm searching for a solution, the answer is ultimately to be found on Reddit. Unfortunately, the owners of Reddit believe this is because of Reddit themselves, as opposed to their users. They own the site, but the users can always go elsewhere to leave their pearls of wisdom.
In the end though, steady, predictable revenue is NOT what share holders want. They want share price to go up... FOREVER. That this is impossible indefinitely, is irrelevant. Management needs to try to achieve this infinite growth path, even at the expense of killing the the goose that laid the golden egg. They are trying to grab more of the revenue generated by the users for themselves. Smartly, they are not attempting to extract that revenue from users directly, but instead they are focusing on partners. Good enough, except in order to meet the share price goals, they need to extract more revenue from business partners than the business partners generate. And in the act of pursing what revenue they CAN get from those (soon to be former) business partners, they are going to poison the communities that the site relies on to be relevant, and ad worthy.
Re: Arguing a strawman... (Score:2)
Re: Arguing a strawman... (Score:4, Insightful)
Because they’re popular internet things. Whenever something is popular on the internet some asshole makes their own “improved” spin on it, markets it which most competing non-moneygrabs can’t do well and then snuffs out whatever everyone was doing before.
Embrace. Extend. Exterminate.
If you think about everything consumers want thats delivered by major internet players today was already popular in some form on the free and open internet back when there were less than 10 million people using it with the exception of high bandwidth applications.
We could have improved the usability of our clients and extended our protocols to embrace new features, address security issues, and so on and basically had most of what we got today with a focus on user experience instead of money grubbing but we let it all slip through our fingers.
Re: Arguing a strawman... (Score:2)
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But on reddit, you can post a single comment that fuels a circle jerk and get 20 thousand internet points.
Certain *other* sites limit you to a paltry 3-4 internet points per post at most.
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Reddit's innovation over other comment boards is how they encourage bots to post on the site instead of banning them.
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They do too. My theory is they don’t need to worry about an “algorithm” to show people what they want to see, if anything ever attracts attention it’ll get reposted to the front page at least once a year forever.
Then these accounts get karma, sold off, and used to make the site and the world a worse place. But hey look at this neat picture of a thing.
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They only ban bots that pollute their real-person data harvesting operation. They are so bot friendly that there's even an official API for bots to use.
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Reddit allowed people to essentially set up forums with zero effort, badly implemented community moderation, and marketed itself heavily to demographics that can produce good discussion. Then digg happened and they hit a critical mass where everyone piled on, it attracted trolls and shills and became a political cesspool.
People only go there because everyone is there and it ruined a lot of good forums I really hope it dies over this.
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Re: Arguing a strawman... (Score:2)
This is why Iâ(TM)m not going to have shareholders. Iâ(TM)m currently setting up a new service (founded the company in January)⦠and Iâ(TM)m going to price it hella cheap because I donâ(TM)t need to make millions right away⦠but Iâ(TM)m going to keep the company small and Iâ(TM)ll be profitable within this first year with a small number of users. I can just hang out and let revenue/profit grow at a reasonable pace. No need to try to play pricing games.
Re: Arguing a strawman... (Score:2)
what they have published is that their revenue is growing⦠fast. And that this is despite much lower revenue per user than other social media companies like Facebook.
if this is about getting to profitability, then they can make ads mandatory, they can charge (reasonable) api access fees for devs, and other things to increase ARPU. Instead they are mandating devs bankrupt themselves. Thatâ(TM)s
Re: Arguing a strawman... (Score:2)
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Perhaps, though I imagine they'll happily accept displaced ad revenue or more so long as the app is still pretty much bound to reddit.
Killing 3rd party apps makes them look like the 'bad guy' and also unleashes criticism of the crappy Reddit designed UIs that is somewhat mitigated by third-party apps doing their job better (and even to the extent that is subjective, it still is a reality in their users' world). It carries a risk of lost user engagement, which they need to survive.
If the goal is to just star
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> If the goal is to just starve out all third party apps no matter what, it's a poor business objective.
A "social media" company with a poor business objective? Pull the other one!
Re:Arguing a strawman... (Score:4, Informative)
Reddit's proposed pricing is 20000% higher than a comparable service.
Reddit: $12k / 50 million requests
Twitter: $42k / 50 million tweets
Google Maps: $650k / 50 million API calls (thought they say "contact sales for bulk pricing")
Imgur via RapidAPI: $3k / 50 million requests
Imgur claimed by Apollo: $166 / 50 million API calls
AWS S3 storage: $20 / 50 million GET API calls
Conclusion: reddit's proposed pricing is in line with comparable services.
I don't know where Apollo's author got the figure $166 for imgur, or what API provider he was using, but the published imgur prices are there in black and white: 7.5 million requests costs $500/mo. https://rapidapi.com/imgur/api... [rapidapi.com]. (Maybe the author was using imgur APIs solely to retrieve images from S3 storage, rather than making actual queries of the img social graph, which might explain why it was so much cheaper?)
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Twitter is also idiotic thanks to Ol' Musky and the others aren't really comparable, Google Maps or S3 is quite a different service than fetching some shitposts.
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Twitter is also idiotic thanks to Ol' Musky and the others aren't really comparable, Google Maps or S3 is quite a different service than fetching some shitposts.
Why don't you think the Imgur official price list is comparable? I think it's one of the best comparables. https://rapidapi.com/imgur/api... [rapidapi.com]. It says there in black and white, $500 for 7.5 million requests (which I multiplied to get $3k for 50 million requests). That's certainly the same order of magnitude as Reddit.
I assume reddit and imgur requests are both querying a social graph, hence some kind of distributed+cached sql storage, probably built off commodity platforms rather than their own hand-crafted
I will delete Reddit if they kill 3rd party apps (Score:2)
For the record, I just paid (too little too late) a license for Reddit Is Fun (RIF).
If Reddit goes through with their plan, I will delete RIF from my phone and never go on Reddit again, which is probably just as well, since it is a huge waste of time.
Re:I will delete Reddit if they kill 3rd party app (Score:4, Informative)
Damn. I have been a raging asshole over there for more than 14 years (same nick, easy to verify) and have yet to be banned.
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Bans in these cases wouldn't be so bad, but shadowbans are inexcusable under reall
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Well, were I running the site I'd probably have banned your second account for a week or two for excessive profanity and an abusive attitude, though context could have excused it. OTOH, I don't see it as threatening violence, just being a very unpleasant person.
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Once might be a coincidence but twice makes me pretty confident he's not telling the whole story and was actually being pretty shitty. It's one thing to get banned by a random mod from a subreddit but from the whole app? That's something special...
Comment removed (Score:5, Informative)
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That is basically a fancy way of saying they're paying Reddit with exposure.
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That is basically a fancy way of saying they're paying Reddit with exposure.
The difference is when you're classically paying people with "exposure" it's usually used to cheap out on their primary income stream. But exposure IS reddit's income. Without the subreddits and content reddit is nothing. They are wholly dependent on the exposure, and not in the "I want my wedding photographed for free and I'll write a blog about you" kind of way.
Planned... (Score:4, Insightful)
How do you start to charge for a service that was formerly free? How do you avoid sinking your platform with such a change? How do multiple high level executives have multiple hours long meetings about the subject come out with what appears to be a silly self destructive plan?
They obviously knew there'd be backlash, came out with preposterous high fees with the intent of lowering them before implementation to appease the masses. They'll pitch it as "listening to the community" and supporting the third party developers.
The issue is will the resulting lowered fees still kill off apps and the useful bots.
I feel they should have looked into better revenue sharing systems, especially given their entire platform is based on volunteer supplied content and moderated by volunteers using bot systems.
Re:Planned... (Score:4, Insightful)
easier said than done. the truth is, advertising pays very little and those sites are massive. they were subsidized by investors, but money just ran out.
it's game over for most of those platforms. and most new platforms don't follow the early 2010s model of "open APIs". they're all walled gardens without interoperability (they realized that providing an API gives your users freedom that restricts your revenue).
there is no such thing as a free lunch.
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advertising pays very little and those sites are massive. they were subsidized by investors, but money just ran out.
A significant chunk of the internet successfully operates on ad revenue. This article [digiday.com] puts Reddit's ad revenue at $424 million. Is that not covering costs?
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“People like doing this thing on the internet so give me VC money enough to get them doing it with me and we can figure out how to pay for it all later”
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In 2021 Reddit raised a lot of money at a >$10B valuation:
https://www.nytimes.com/2021/0... [nytimes.com]
If the shareholders have bought in at this valuation they will accept risk of tanking the platform if there is also a chance of it providing the expected ROI that the investors have paid for.
I see this as a problem with today's stock market and busin
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How do you start to charge for a service that was formerly free? How do you avoid sinking your platform with such a change?
Slowly with sensible pricing structures. So unlike what reddit is doing.
LOL (Score:5, Interesting)
So I assume all the mods that do the real work keeping the site busy and popular will be 'Fairly Paid' right?
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The value of social media sites (Score:4, Insightful)
1) If it's no longer free, almost all your users will leave
2) If an app developer is bringing in users and can no longer afford to do so without charging, their users will leave and a good percentage won't bother with another access method.
Realistically, the 'value' of any specific social media site to the end user is near-zero; there's always another site to migrate to, even the most hardcore rage poster can move somewhere else. If your company can't monetise in some way that doesn't result in a bill to the end user, your social media site will not last. At least, not outside small niches.
Like many, I enjoy a good bonfire, so I'd really like to see this grow into an uncontrolled blaze at Reddit.
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Exactly. No one will miss Reddit or any other social media site. There's always another one.
Block ads, get it free, move on when it dies.
Most/all social media is toxic anyway.
Would love to see Twitter, TikTok, Facebook, and the rest all burn. No value lost to society.
Re:The value of social media sites (Score:4, Insightful)
The question is do they have no value or negative value?
They do provide benefits, but I think the costs probably strongly outweigh the benefits. But the same is true of candy.
I must be the only one... (Score:3)
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I pay for API usage for a number of services - IP lookups, traffic through Cloudflare, tax information lookups, etc - and any one of them would, at a fair market rate for the services, bankrupt me if I needed to do 50 BILLION API HITS a year. That's insane.
Reddit: $12k / 50 million requests
Twitter: $42k / 50 million tweets
Imgur: $166 / 50 million API calls
Google Maps: $650k / 50 million API calls (thought they say "contact sales for bulk pricing")
AWS S3 storage: $20 / 50 million GET API calls
Honestly, reddit's prices seem reasonable!
You said 50 billion API hits per year from Apollo. My calculation is 83 billion API hits per year: the Apollo author said "50 million requests costs $12k" and estimated his bill at $20mil to keep Apollo running.
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50 million API calls are $166 from Imgur and $12,000 from Reddit. Those numbers are worlds apart.
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50 million API calls are $166 from Imgur and $12,000 from Reddit. Those numbers are worlds apart.
7.5 million API calls are $500 from imgur -- it's officially here https://rapidapi.com/imgur/api... [rapidapi.com]. So 50 million calls would be $3,000. This is quite comparable to reddit's proposal.
I don't know where the quoted $166/50mil came from for imgur. I suspect it came from a quote from the Apollo author and was misdirection. My hunch is that maybe it refers solely to the price for fetching images from imgur, which probably merely needs to retrieve them from storage and so is closer to the $20/50mil cost of AWS t
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I can't get Google Maps pricing tool to even try to go that high without it kickng over to 'not saying, you'll have to talk to someone'. No idea what the price is.
Twitter's pricing is so well known as it was a famously recent story about how absurd the pricing was, as another example of Musk grasping anywhere and everywhere looking for a business plan.
The others are all hundreds of dollars instead of over ten thousand dollars, hardly seems reasonable by comparison.
Of course, quantifying by 'API requests' se
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To take his math to his per-user estimate, looks like he expects on average 10k api hits/month per user. I loaded up reddit in a browser to see roughly how many calls their in-house software makes over a bit of scrolling and it didn't take long to get to a thousand api calls.
So reddit's own development team incurs what would they would consider to be 25 cents of cost to serve me up a bit of mindless scrolling over the course of a couple of minutes....
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Sorry but those kinds of one off lookups do not remotely compared to the required API calls to bring up and manipulate content that a typical use will spend seconds looking at and moving to the next API call.
Not all services and API calls are equal. E.g. I have a weather station here which makes API calls that over the course of the entire year would be less than just a few seconds of scrolling through Reddit. It's the nature of the service.
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I pay for API usage for a number of services - IP lookups, traffic through Cloudflare, tax information lookups, etc - and any one of them would, at a fair market rate for the services, bankrupt me if I needed to do 50 BILLION API HITS a year.
I don’t think you’ll find a lot of disagreement that there are likely some areas where Reddit needs to charge for using APIs — tools that are scraping Reddit comments to create AI datasets for example.
But Reddit’s “product” is their user base and their content — and when they’re charging for API use for things that generate content for them, they’re effectively double-dipping. It’s like if your employer suddenly decided to start charging you for c
Slashdot's Phoenix time (Score:2)
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Read your HG Wells.
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Rubber, meet road. (Score:2)
Is reddit's model sustainable without this cash injection? Who knows? It's a private company. But there comes a point where you either move to profitability or fold. Unless, of course, you can corral such an huge level of ongoing buy-in that you can routinely run losses for years on end like Amazon... but even angel investors eventually get tired of bleeding money.
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I'll draw that line at the top, thanks. If they've made any money, I'd be surprised to hear it.
Cry more. (Score:3)
Hey Reddit: maybe think about investing in your app development to reduce the need for 3rd party apps instead of investing in ways to fuck over the guys who make a better Reddit app than Reddit apparently is capable of. Then the revenue issue takes care of itself.
Just a thought.
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> maybe think about investing in your app development to reduce the need for 3rd party apps
They did. They bought Alien Blue, then took a wicked shit all over it and turned it into the official Reddit App
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Reddit really wants everyone to use their first party app. That way, they can monetize your browsing history in the in-app browser that shows up when you click on a link from inside the app. Reddit doesn't have the same incentives as 3rd party app developers. App development at reddit is focused on milking users for their data, not giving them what they want.
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Based on my experience in tech, the in-house app guy has the hubris to assume it's just a branding issue and would drive the company to buy a popular competitor just to rebadge the official app.
Because no one in tech wants to admit they aren't that good at their job.
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They tried that already and fucked it up. Clearly such a simple strategy is beyond their ability to execute sufficiently.
Reddit shoul pay its users (Score:5, Interesting)
Reddit is right that they are hosting content that third party apps are profiting on. But by the same logic, reddit is profiting from the content created by its users. So it seems only fair that the users get paid as well then.
Reddit is disingenuous on this (Score:2)
Reddit is worth jack shit (Score:2)
And Jack left town. So pay them what they're worth.
Why not give Reddit subscribers their own API key? (Score:2)
If you pay for Reddit premium that should be enough money for Reddit to let you use the API for personal use.
Collateral Damage (Score:2)
At least some of those third party apps are used by people with vision problems to access the platform. Apparently Reddit is aware of this, and isn't willing to make any special allowance for such apps. Its own interface is absolute shytte, even for people without disabilities.
Are they going to charge browsers? (Score:2)
I mean, unless the API is really shitty it has to be more efficient for them, or at least as efficient as having people just use a web browser. Is Apollo stripping out adds? If not, I don't see a logical leg to stand on for Reddit to be charging, because at that point it's just a fancy browser.
It is a standards compliant website (Score:2)
Of course with the way Reddit is going, it is overdue a mainstream replacement.
I'm reminded of a quote form a movie (Score:2)
Josey: "You promised me those men would be treated decently"
Senator: They were treated decently. They were decently fed and then decently shot!.
Middleman (Score:2)
Reddit is a middleman.
Middlemen can add value, but frequently do not.
Reddit is not an exception.
Meh. (Score:2)
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I think they laid off those people because they *are* starved for cash. The reason they are looking to an IPO is because they are starved for cash: it's time for the owners to cash out, and get back their investment. The funding money is gone. Revenue is up, but a lot of people believe Reddit has still not crossed the profitability line. The owners are desperately trying to make it to the finish line.
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Reddit's own app does several hundred calls per minute of average user interaction, so I'm assuming the API design pretty much forces you to make a huge amount of calls to get the information necessary to provide a useable app.