[fencepost]

Whether they truly got it wrong depends on exactly what their (publicly unstated) goals really are. It's possible that this is driven by incompetence and ego as has been seen elsewhere in social media in the past year, but it's also possible that apps weren't a target and were just a bystander. A LOT of this depends on the question 'who are they wanting to have paying?'

Personally, I think they got focused on one particular thing (AI firms and any other content vacuums) and lost sight of other options for making money. In that context, trying to do volume-based charging to the third party apps makes sense, because in a lot of ways you're just treating them like all the new customers you're targeting.

I think this completely misses the potential for monetizing their users beyond ad impressions, but maybe they did analysis and decided it just couldn't happen - or maybe they just dismissed it because they had different customers in mind.

It still seems to me that they could (now could have?) converted a significant percentage of mobile app users into paying customers - perhaps not at the Premium price point of $50+/year, but likely at a lower price point of $18/year (still way more than they were getting from ads) they'd have taken a ton of free users and turned them into paying customers, and they'd have done it while keeping the lion's share of the money themselves instead of having app devs and app stores thrown into the mix. In addition, once you've got them paying you have plenty of options to try to steer them to higher plans - someone wants to have multiple accounts for family or privacy reasons? That's only available with Premium, or with a Family plan. Want higher API limits? We can sell you that. Spending time moderating a popular subreddit? Thanks, would a free subscription make that easier for you?

But maybe potential investors don't actually care about having paying clients.