It's a spectacularly stupid move, almost on a par with Musk >50% of Twitter's value and Waves trying to force their customers onto a subscription model by making old versions obsolete.
Reddit will lose a huge number of users, its brand will be trashed, and the app companies will be forced out of business.
There is no way this can't end up as a net loss.
Reddit will lose a bunch of deadbeat users, who generate little to no income for the company but cost money to serve. In business, these are the sort of people you don't want.
Who do you think will spend hundreds of millions a year to replace Reddit so that deadbeat users can use it? There would be no money in serving those users and any attempt to serve them and monetize later will result in the same thing that is happening at Reddit. The days of VCs burning money for social networks seems to be over.
I would suspect Reddit has done the maths. And saw that most content generators use their app or the website to post.
And every big decision they've made has made it worse, not better. Do you use new reddit?
I've cancelled my subscription.