"We are losing lots of money, we need to start making money, reddit gold isn't bringing in enough revenue to pay the bills. 3rd party apps don't show ads, which costs us a lot of money every month. Keeping the 3rd party APIs up and running also costs us money. Because Reddit needs to stop losing money, we are closing down 3rd party apps."
I don't know what why it is so hard to say that...
Now, even if they backtrack on this later on in a few months or years, they burned the good will, so I doubt developers are going invest the time to make a good Reddit client after this.
Truth, being perhaps the most interesting, because the main personality behind it sort of compelled it to be semi-well-known simply because of media coverage. The other attempts do not share that effect, however.
You're right that early movers have some advantage but it's a big world and the Next Big Thing doesn't have to win the whole market on day one - only enough of it to plant seeds that can grow over time.
Apollo is shutting down because the founder thinks they'll incur about $2.50 per month of costs per user, and apparently doesn't believe enough people will be willing to pay $5 monthly to keep Apollo running.
So, this Reddit Premium (billed at $5.99 monthly) either has few-to-no paid users, or Apollo's founder isn't even trying to sustain his business.
> So, this Reddit Premium (billed at $5.99 monthly) either has few-to-no paid users, or Apollo's founder isn't even trying to sustain his business.
If you read the post, it's not just about the willingness of users to pay. It's also about the existing obligations (prepaid subscriptions), the timeline of the changes, and the amount of work that would be required on his end to adapt to the new changes within the next three weeks.
None of that would be an issue with the proposed solution of Reddit charging the users directly.
He could fire up a new system with appropriate pricing as soon as he can manage. All customers, if they want to come back, are then forced into the new system at new pricing levels. Maybe this takes a month or two or three. He's not losing money in the mean time and can re-open at something resembling a profitable stance when he can do so.
Yes, it sucks. But there's a path here if he wants to go for it. I don't blame him for throwing in the towel. He's tired of getting yanked around. I would be very hesitant to keep throwing good time(money) after bad.
Good call out. It's like the business equivalent of:
You changed the rules of the game because you didn't like how I played. So I'm not even going to bother playing with the new rules. I retire.
The rules of the game changed so severely that playing the game isn't just disagreeable, it's impossible.
What would you have done instead?
Charge $5 monthly and refund the annual fee for those who want it (which is already being done it seems, regardless of Apollo's future).
Apollo has options. They're just choosing to shutdown. That's the founder's prerogative, of course, but it is totally unnecessary.
Look at the support in this thread alone - Apollo has tons of people willing to throw money at them.
He has 50,000 customers who paid $10/year for the app. Now he's put into a position to support those customers at $2.50/month. (He estimates their server cost is $0.10 per month.) That's an instant $125,000 per month out of his own pocket that he can't recoup from existing customers for at least the next 6 months.
Over the course of 2023, he'll have to pay Reddit $1 million MORE than he has made from the app this year.
Reddit doesn't want to work with third-party apps. That's fine. That's their right. But it's certainly not the app developer's fault that he's forced to quit.
This sentiment is obviously false. Reddit doesn't want to support third-party apps at Reddit's own expense. That is reasonable.
> He has 50,000 customers who paid $10/year for the app
And now we get to the issue. This was never a sustainable business model. It depended on Reddit API being free - even at the massive volume Apollo operates at. That is unreasonable.
I take him at his word that he was willing to pay a reasonable amount.
Again, Reddit has the right to run their business however they wish. Not arguing that it should be free.
Christian has already shared his correspondence on Reddit with this. He pretty clearly sought and received regular assurances that when and if Reddit moved their API to a paid model that it would be at a reasonable cost and with a flexible timeline to accommodate third party apps.
After telling him no such big moves were happening in 2023 they changed their mind, set punitively high prices and gave barely a month's notice.
What does this even mean? "Reasonable" is subjective - and from Reddit's perspective, I'd bet they believe the fees are reasonable.
It's on the business operator to mitigate risk. Apollo didn't do that - and is now throwing in the towel instead of charging their customer's more.
> set punitively high prices and gave barely a month's notice.
Apollo has had since April to figure out a new billing model - but sat on their hands hoping whatever Reddit came up with could be afforded with their existing $10 per year per user model. Say it out loud - it's absurd.
Just stop.
You’ve been told multiple times, by multiple people, that this was not the case.
You’ve been provided the timeline, which you refuse to acknowledge.
You very well know that he was not provided the pricing until 8 days ago.
At this point, you continuing to say this is just being disingenuous and talking in bad faith.
What, exactly, are you getting out of this? Is unreasonably placing the blame on a single developer your way of getting your rocks off?
You may want to believe and be sympathetic toward Apollo - fine.
That doesn't change the circumstances nor realities. Apollo screwed up, and is now throwing in the towel. It's really hard to be sympathetic towards a business operator that's made a series of bad choices and now is playing the victim card and shutting down.
You’re the only one who is finding it hard, and your constant push to shift the blame off of a massive corporation and onto a developer is frankly weird.
Re-evaluate your life choices if you truly believe this, but it’s clear you are the extreme minority here.
There is no chance I'm paying for a "service" where power-mods will ban you for disagreeing with their radical politics, where most of the subreddits are actively taken over by similar power mods who push their radical ideologies, and where any attempts to evade this stuff and simply use the website can get you permanently banned from the service.
Imagine spotify, but if you listen to the wrong songs, you get banned from other random artists, and if you try to work around this you just get banned outright from spotify.
No thanks.
In that case, app developers have several options:
* start showing users ads, and use that to pay both themselves and Reddit
* start charging a monthly fee for the app, and use that to pay both themselves and Reddit
* some combination of these two (e.g. pay a subscription for ad-free use)
Sure, Reddit could make this easier for app developers, but isn't it all basically the same thing at the end of the day? Reddit wants (or needs? I have no idea what their financials look like) to make a certain amount of money per-user or per page view. Apps take home ~100% of their profits currently, and make Reddit ~nothing. So Reddit is pricing in a profit rate into API access.
I mean, just to look at Apollo, they have 166K ratings on the Apple App Store, and surely far more users than that. Reddit wants $20M a year from them. That's high, maybe too high, but how does it compare to the value of (say) a million users a year on the official Reddit app? If Apollo switched to a subscription model on which they charged $1 a month to users, would they be able to pay Reddit's API fees? (Assuming those API fees would drop by at least 50% after non-paying users quit using Apollo.)
The issue is that the actual numbers are closer to 2,000%, not 80%. [0]
[0]: https://old.reddit.com/r/apolloapp/comments/13ws4w3/had_a_ca...
- Reddit is charging the equivalent of 20x its published revenue per user for the API.
- The new API agreements ban the display of any advertising by API users. (Apollo did not show ads, but other third-party clients did, and Reddit claims the low quality of ads was harming Reddit by association.)
- Charging $5/month would be break-even given the API pricing, and only for new customers. Apollo would still have to serve earlier subscribers at a huge loss. API fees would certainly not “drop by 50%” — the vast majority of people subscribing to Apollo are power users, so the average API usage per customer would _increase_.
There's a lot of strange stuff happening in your comment. On the one hand, let's take for granted that Reddit is charging 20x its revenue per average user for the API. But that's just the average user; as you yourself point out "the vast majority of people subscribing to Apollo are power users". Surely they are worth much more to Reddit than the average, extremely casual user?
The underlying problem explained in the post is that the author pre-sold access to Reddit through an app to users, while this access was actually conditioned on the continuing availability of access to the Reddit API. No doubt this does put the author in an uncomfortable position! Given that the current plan is to shut down the app anyway, surely cancelling active subscriptions should also be on the table? Subscribers are going to lose access to Reddit through Apollo either way! So realistically, what we're talking about here is whether $5/month is a reasonable price point for power users. My answer is... maybe?
I think my instinct is to say that this is all ultimately the place where negotiations are supposed to happen. Reddit needs to go from making zero dollars off the API to making something. Is what they want to charge too high? Probably so. But a lot of people are acting as if any charge at all is untenable.
Is that the case? Every reaction I have seen has been to the magnitude of the price, which is much, much, much more than what Reddit makes off of users
Its greed that they got here. They made choices, and then as a consequence of those choices they made choices that are significantly reducing the value they provide to their users. Its enshittification, its killing the golden goose, its destroying a public good for the benefit of investors who don't care about anything other than making a return.
The worst part is the investors don't care about anything other than making the numbers look good in the short term so they can dump their investment onto other investors. Its like all of corporate america decided to watch The Wire and go "Oh see how they're pumping up the numbers to make them look good for the mayor, but not actually solving crime? THAT should be our business plan!". Providing value is a side effect of making money, on the false equivalence that making money means you're providing value, so therefore making more money means you're providing more value.
Wikipedia is pretty fantastic. Signal is pretty great. I'm pretty happy with NPR. Archive.org makes me happy.
Appeal to people with money (the professional class) and then beg.
I feel like the next great social media platform will result from a rich person disillusioned by reddit (a Bryan Acton type) creating a platform resistant to "next quarters profit"-ism.
A text website is easy to run.
So ultimately they want 3rd party to use subscription model to ultimately get worse experience.