I personally don't find the ads at all objectionable on the old.reddit.com site. They blend in with the other content reasonably well (so you see a Jetbrains ad when on /r/programmerhumor), don't slow down the site, either fit the flow well or hang out on the side, etc.
I find the targeting to be good enough that I look forward to the ads to a certain extent as I have found all sorts of fun products that way.
Not sure if that is enough, but does Reddit really need 2000 employees and hundreds of millions of CV money? I have a hard time estimating what it costs to run a site like Reddit.
Reddit has been overwhelmed by a certain type of employee that spends more time worrying about the political opinions of their colleagues and less about excellence and productivity. Similar to twitter which turned out to be a finely tuned Rube-Goldberg machine that required hourly maintenance to keep online. Im not saying I’m smart enough to make things work well but that such people exist and they don’t/didn’t work at either twitter or Reddit.
Current ads at Reddit are not that bad, it is nothing like youtube which is borderline unwatchable at the moment. But for Reddit general there is like lot of astroturfing currently and if Reddit could start capturing some value from that and same time show for regular user that this is commercial/pr account would be win-win for Reddit and regular users.
I would bet money that Reddit has the highest percentage of ad blocking users. Either by way of browser extension or third party apps. They just don't have enough impressions to cover the outlandish costs associated with running the site. Combined with lax content moderation policies, advertisers see more value going with third parties that can push a viral story about a product to the homepage.
There is no one problem with Reddit, and that is the problem. They have to reboot and build Facebook 2.0 (or whatever) without a highly fickle user base turning tail and running. Rock, meet hard place.
> There is no one problem with Reddit, and that is the problem.
Actually there is one singular problem ... money.
They could accept that "reddit the product" is a 2-5bn market cap business with solid 0.5bn revenue; staff up on that basis, scale their infrastructure on that basis, M&A on that basis, set investor expectations on that basis.
Reddit hosts its own ads, so seems like it would be relatively trivial to overcome the adblockers and insert them directly into the feed server side. Sure, that will piss a few people off, but more than this?
They could turn off video and image uploads and reduce server costs substantially. Remember when you couldn't directly upload a video to Reddit and everything was a link to YouTube, Vimeo, or Dailymotion?
I would say the problem is that the user base are low value users. They're the sort of people who will do a mass protest because one for-profit company wants to charge another for-profit company money. Advertisers don't want to advertise to them, seriously. Any other company with a different user base with that amount of users and traffic would be making a billion a year easily. Probably multiple billions. But Reddit users are low value. There the sort of people if a company tries to engage with them with just be hostile. This means the amount of money Reddit can charge for ads isn't that high. Which means the companies advertising on Reddit are generally on the lower end of the scale or it's just a tiny part of a bigger ad campaign.
So if ad revenue isn't going to do it. Then it needs to be a freemium model with subscriptions. They probably get 25% of their revenue from reddit premium. That also means, charging for the API.
The problem for many of the third party apps is they've also been running a freemium model with very low overheads due to the fact Reddit has been largely funding their freemium model. They've been charging next to nothing for their premium options ($1.50 a month) and they have massive amount of very active users. They're so big that paying a reasonable per API request fee results in a massive bill. A bill they can't pay due to a freemium model and super low fees that don't pay for the freemium users. Third party apps directly compete with Reddit, therefore it's fair they pay Reddit for the resources they use as well as the lost potential of the users they did take. Those paying for premium on an app would probably pay premium on Reddit.
Then comes in the low value users, who are outraged the free toy they have wants to make a profit. "It's too much money" - funny enough Reddit users think they're worthless - was one of the main cries. "This third party app IS REDDIT" - well if they're Reddit they shouldn't need Reddit access. A userbase who resists being monetised. Either they're monetisable or they're not. If they're not the company can't survive. What the Reddit users need/want is a non-profit.
The vast majority of users on any platform are passive consumers, they are valuable only as long as they keep scrolling and viewing ads. The ultra tiny minority of users that are valuable to the platform 24/7 are the ones that consistently submit links, generate original content or post comments that bring in a lot of the passive users. The high value users will only leave when they loose the ability to upload to, and interact with, their favorite communities.
High value users are a completely different demographic.
Realistically, there are a large amount of people who don't care about the protests. They're going to be creating content. I wouldn't be surprised if the people most outraged are the ones who don't even comment that often.
You're not wrong: reddit probably needs to raise their income, which means monetising their users more.
The biggest issue most vocal users (including many mods and developers of third party apps like Apollo) have, is that the prices are much higher then the expections reddit set beforehand and that everything was only communicated 30 days in advance.
If reddit wanted to keep third party apps, but have them pay for the users use of reddit, they could have implemented a transition plan. Or make it work another way. Or charge a realistic amount (you yourself state reddit's users are low value, but reddits is asking for $20 million per year in missed monetisation just for Apollo's users, which is very high value).
Instead, reddit seems to approach this aggressively, signalling through their actions that they intend to kill off all third party apps. That's what the the subs going dark are protesting against. Especially since reddit's own site and app are of significant lower quality.
I'm not sure how to read your message exactly. If you mean the teenage warez leecher type who doesn't care about wider ramifications for the ecosystem, then sure, not high value. I would hesitate to put the protesters in this category wholesale.
Otherwise wealth correlates somehow with both caring about your interests, and caring about abstract causes, for different reasons and often not in the same people. This is why 1) businesses catering to affluent people are often more cautious about the cheapest tactics (even if they ultimately go for the same results), 2) there is so much public faux political idealism from companies.
They also sold awards / points / things, which seemed pretty popular for a while at least; I have no idea how much that earns them though.
But there's plenty of avenues they have for generating revenue that doesn't involve shutting down 3rd party clients, e.g. commercial promotions, signal / post / comment boosting, subscriptions for advanced / exclusive features, etc.
and when you try to rein in expenses to show less ads, the community begins to propose $10M buyouts and every refrain from reasonable optimizations of their API calls.
This references the Apollo client discussion and is wrong on many levels.
1. They are not "reining in" expenses, they are purposely pricing out 3rd-party clients (which probably has the goal to show more ads, not less)
2. The $10M buyout comments was a reasonable comment countering the statement that reddit loses $20M each year by users using Apollo. A comment which was a half-joke, as the audio recording shows clearly. In that case, buying Appolo for $10M would have been a steal and Reddit would have jumped on it. They didn't, their prior statement was probably a lie.
3. There were no suggestions for reasonable optimizations of API calls. Apollo claims they already optimized whenever possible and whenever they were asked for it, and that client was specifically not listed in an earlier discussion about ineffective API usage. Reported measurements confirm that, the official API uses more calls. Regardless, later Reddit made this accusation, showing that they are not truthful in this discussion.
> 2. The $10M buyout comments was a reasonable comment countering the statement that reddit loses $20M each year by users using Apollo. A comment which was a half-joke, as the audio recording shows clearly. In that case, buying Appolo for $10M would have been a steal and Reddit would have jumped on it. They didn't, their prior statement was probably a lie.
If something loses me 20M$ per year and I have an option to buy it for 10M$ or kill it for 0$, I would choose the latter without much thinking. And that seems to be exactly what Reddit is doing.
And that is something that any client using a third-party platform should expect that will happen eventually.
That sounds completely reasonable - if you assume the users currently on Apollo 1) Can't be made to pay, directly with a price for the app or micropayments or indirectly via ads 2) Would move to the official app if Apollo shut down and 3) Don't bring in posts and comments with which other users engage, raising money that way.
Sounds to me that shutting it down is the one sure way to lose money, but I also don't trust that the reddit team had made that calculation properly. This all seems like a short term profit or like a power play to me.
> If something loses me 20M$ per year and I have an option to buy it for 10M$ or kill it for 0$, I would choose the latter without much thinking.
Weren’t the $20M reddit claimed they are losing, missed opportunity costs? I.e. if Apollo users wouldn‘t use Apollo but the official app, they would make that amount of money off of them. So buying that amount of revenue for $10M sounds definitely reasonable to me. If what reddit claims would be truthful that would be a guaranteed 100% ROI.
Would those users continue using Apollo after Reddit bought it and filled it with ads or would they start to slowly drift away to other clients over time?
i don’t care either way, other than HN and some Mastodon i don’t really social media much anymore. Reddit could disappear tonight and it wouldn’t bother me much, but…
> A comment which was a half-joke, as the audio recording shows clearly.
…at some point people need to understand that jokes are about timing, about audience, about place, and the subjects of the joke.
again, i have no dog in the fight, but the number of times i’ve heard “it was clearly a joke” is wild. we’ve all seen people from every political corner from every walk of life proclaim “clearly that was a joke” when repeatedly it wasn’t received this way by those involved.
jokes are about timing.
all of that said, i do wish the founder of apollo well, if old.reddit wasn’t your thing apollo truly was one of the better alternatives.
slight tangent, but this is another lesson on how we inevitably screw ourselves when relying on non-open source.
if it isn’t ours, the thing is someone else’s. we have to face this. we repeatedly see the repercussions of ignoring this fact.
Profit depends on 2 things, revenue and expenses. Reddit has tripled their headcount over the last few years so they can focus on new features like NFTs. If they were concerned about sustainable profitability, IMO they should've kept their headcount around 500 people and tried to grow revenue without totally blowing up their costs.
It's not trying to be. They only care about the value of the equity, not about profitability.
It'd pretty easy to be a profitable company with a $10 million turnover, but you're not going to be a unicorn this way. Founders and VC wants high return on their equity, and today being enormous without profitability is valued more than being reasonable and profitable.
spez's comment "We’ll continue to be profit-driven until profits arrive. Unlike some of the 3P apps, we are not profitable." suggests a real concern about not being profitable. In fact, the whole ordeal reeks of panic – a last ditch attempt to right the ship before bankruptcy sets in.
There was once an age where investors would buy in simply on the belief of unicornedness, but that ship sailed several months ago. Investors have become much more critical of tech businesses, showing substantially less interest in tech companies that aren't displaying strong fundamentals. A recent Fidelity report indicates Reddit's own valuation has dropped by 41% on that change in sentiment.
There's no reason to buy's spez's words, nor any other executives in any company for that matter, their job is to spread a narrative.
In fact, if profitability was the goal, then he should have been ousted at this point, because he's been back for 8 years now without succeeding to make the company profitable.
I don't think he is that inapt, and that his board is stupid to let him in charge despite such a failure, profitability was just never the goal. Getting the biggest possible IPO is the goal, but the timing is actually very bad for them for the reason you mention and now they're trying as hard as they can, including by creating fake subreddits with translated old content for non-English speakers (at least French and German speakers).
> I don't think he is that inapt, and that his board is stupid to let him in charge despite such a failure, profitability was just never the goal.
Just fyi, reddit rose around the same time as Facebook so it’s likely they share a similar governance model, where founders control an outsized part of the board/voting shares. Since Uber and wework semi-imploded investors are less forgiving of that sort of thing but legacy companies like Reddit likely still are run that way.
Spez sold his shares in 2006 before joining back as a CEO in 2015. He probably has equity as the CEO, but not as many as a regular founder and as such he should have much less power and control over the company than Zuck.
How is reddit highly cacheable? Maybe old/infrequently accessed discussions are cacheable, but the live set is too dynamic. So there probably isnt much of a win there.
The feeds are definitely not cacheable (except for maybe on a per user basis with a low ttl). Popular and all are never the same upon reload. And every user is going to have a different combination of subreddits. Those feeds have to be generated on the fly. Most of the data is too dynamic and ever-changing to cache effectively.
- Cache for unlogged users, have a less dynamic front page (let's say 10s cache), that would help a lot
- Cache of most popular topics (again, even a 10s invalidation time) would help
For the logged users you could do something more dynamic, for example, cache the front-page snippets of the main subs + add the ones for the user. And again cache that
(unless the 'new reddit' makes this harder, to which I would say - well deserved! ;) )
Stop spending so much money developing features that are useless for adding value to the site; stop hiring devs to create new 'resume' features like counter-productive reverse-blocking and hire devs to fix modding tools. Stop spending money hosting videos and multimedia when your core value is text conversations. Don't make stupid decisions like destroying your most popular features (the AMA subreddit, the secret santa) because you are stupid. Fire your CEO who is doing all of these things.
There is no reason reddit can't be profitable if they did these things. They don't need 100,000,000 users watching videos to bring in ad revenue. They need 10,000,000 users generating good content that ends up as top google results and they can find clever ways to monetize product tie-ins, annual meetups (those were a thing in a lot of cities a while ago), events, merch, and subscriptions. It isn't rocket science. The top stockholders just have to be satisfied to be millionaires instead of billionaires.
The community is not proposing $10 million dollar buyouts. That is literally a joke that if the API has the value Reddit claims (which it doesn't) then they are defacto putting those sorts of valuations on the app.
Reddit already bought a third party app with Alien Blue, and they ruined it so badly that they had to close it down and start again. Nobody wants Reddit in charge of the third party clients, they have awful UI designers and a user hostile UX team. The whole point of a third party client is that it has to actually design a UI that it's users like, or it dies.
