[hackersword]

To date I've seen no logic that shows how any of reddit/spezs actions will actually increase profit.

Making a wild claim about how much 3rd party apps "cost them", is not the same as actually seeing revenue once those 3rd party apps are closed.

As most people have been saying, the majority of 3rd party app users are the more advanced technical savvy ones.

There may be SOME percentage of the 3rd party app users who transition, but if the 3rd party traffic is as trivially small as Reddit has claimed, not sure how that will overnight magically transform them into being profitable.

I've never seen an Ad on reddit with use of old.reddit.com , RES, and adblockers. I was a primary user of Apollo, and I certainly won't be using the reddit mobile app. I deleted the app off my phone once the writing is on the wall (rip the bandaid off now and detox vs in 9 days), my phone reported my usage is down 19% this week, so that is a plus.

Absent any business plan on how those actions will actually drive profit, everything they've done has had sole effect of alienating their power user, mods, etc. and I don't see how that helps profit.

[weaksauce]

> There may be SOME percentage of the 3rd party app users who transition, but if the 3rd party traffic is as trivially small as Reddit has claimed, not sure how that will overnight magically transform them into being profitable.

he said 97% of users are on the reddit app. he also said there is a significant opportunity cost to having those 3% of users not on the app. so for both of those statements to be true that 3% of users must be very active and providing a lot of content and value.

[philistine]

And he’s alienated virtually all third-party apps, putting those 3% user at high risk of just leaving the platform, destroying that supposedly huge opportunity cost.

A competent CEO would have found a way to keep them in the family.

[pcthrowaway]

What's bizarre to me is that the app inhibits activity.

Like, I can type 20 comments on my laptop in the time it would take to type one on my phone, and they'll be more well-thought out too

[michaelt]

If the speaker was setting out to bullshit you, "significant opportunity cost" could mean a lot of things.

Perhaps they mean a non-financial opportunity cost, like they could modify their API if they didn't have third parties depending on it, and they're missing out on the benefits such modifications might hypothetically provide.

Or perhaps "significant cost" means, say, $100k per year. Significant at a human scale, insignificant at the scale of a multi-billion-dollar company.

[HDThoreaun]

> I've never seen an Ad on reddit with use of old.reddit.com , RES, and adblockers.

Which is why they're trying to force everyone onto their first party app. If you're not contributing to revenue they do not want you on the site.

They have much more data than we do which leads me to think they have reason to believe most third party app users will switch/the ones that won't arent worth having anyway.

[tester457]

They're shooting themselves in the foot, more technical users produce more quality content that the lurkers enjoy.

[raincole]

> more technical users produce more quality content that the lurkers enjoy

Well... we assumed so. But I highly doubt if it's true.

[ryathal]

I'd say the notable drop in quality and activity in open subs that aren't protesting is a good indicator that there is some truth to that assertion.

[that_guy_iain]

I have no idea what you're talking about. The subs I am on have pretty much the same quality and activity.

[that_guy_iain]

I think this is just pure arrogance. Some of the best content creators on the planet aren't technical. In fact, very few of technical people are good content creators. We just like to think we're so good.

[HeyLaughingBoy]

Yeah, that explains the popularity of of the /r/*gonewild fora.

[mcmcmc]

3rd party app users are all cost, no revenue. Just eliminating them would by definition move the bottom line towards the black.

[gbear605]

Reddit doesn’t like to remember it, but it’s fundamentally a site where users provide content, and only a small fraction of users provide the most popular content (and do moderation). Those fraction tend to be the more advanced users that use things like third party apps or RES. So hurting those users is decreasing the amount of free work that the users give to Reddit, which means that either the site decreases in quality (less revenue) or Reddit needs to pay employees to do the same work (higher costs).

The cost of the third party apps themselves was trivial, and if they just wanted to recoup those costs they could have proposed a much more reasonable cost per user for third party apps.

It’s about control, not about profit.

[that_guy_iain]

> The cost of the third party apps themselves was trivial.

$10m isn't trivial unless your operating costs are in the billions.

[gbear605]

That’s what they wanted to charge - Reddit only makes $0.13/user/mo, so their cost must be less than that (or else Reddit has much bigger problems), so let’s say $0.05/user/mo. Apollo has 2 million users, so $1.2 million per year.

Moreover, at that cost, less than a dollar per user per year, Apollo could have instituted a $1/year subscription. But instead Reddit wanted over $100 per user per year, two orders of magnitude more than the cost.

[tensor]

This is rather limited thinking though. The value of the platform is ultimately in it's content, and if those 3% of users on 3rd party apps are highly influential in driving content, then by driving them away you will harm overall value.

It's one of those typically short sighted "oh lets remove this thing costing us" without understanding the long term impact to value.

[ryathal]

RIF had a revenue sharing agreement that was canceled years ago with no attempt to replace it with something reasonable.

[KallDrexx]

It's kind of interesting though because a lot of people using 3rd party apps have proven they are willing to pay for a good experience (Apollo had a subscription I think, RIF has a paid tier, etc...). So instead of charging apps for API access, just require all access through a 3rd party app require authenticated users, and those authenticated users must pay a monthly fee to use third party apps.

You don't over burden one single entity with large recurring payments (the app developers themselves), your power users provide revenue, and you can slowly work on your value proposition of "hey we have updated our app to not be as crappy, you can browse reddit for free if you switch back".

[that_guy_iain]

> To date I've seen no logic that shows how any of reddit/spezs actions will actually increase profit.

I think you assume that the only people using it are shutting down while obivously there are lots of profitable companies using the API who will obivously be fine with paying $0.24 per 1,000 API requests.

Then there is obivously OpenAI and other AI based companies that are really the main reason for the change.

Realistically, having Apollo, etc not there drives people to use the main app. Saying that people won't switch over seems naive. There will be some that won't be realistically the vast majority probably will. And those users then go back into monetization drives. Which will increase revenues.