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Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

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Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#111

Post by Sakos »

flutas wrote: post #59
paxys wrote: post #21

The part about him already selling 50K annual subscriptions to Apollo is the interesting one in the piece, and explains the decision to discontinue the app. He entered into a contract with users assuming that his API costs would be 0. He can't change that contract and start charging another fee on top, and is obligated to continue to provide the service no matter what Reddit now decides to charge him. So the solution…

> So the solution is easy for any laywer to provide - just shut down the business. I don't really agree with that take. He's already talked about what happens now, and it includes refunds for unused subscription time. > I've been talking to my rep at Apple, and over the next few weeks my plan is to release something similar to what Tweetbot did (Paul has been incredibly helpful in all of this) where folks can decide…

Based on what he said, it's clear that trying to run Apollo while servicing these users would cost him hundreds of thousands more than that with no guarantee that he'd be able to make up the difference over time. So he is just shutting down the business. Even if he's legally obligated to refund the users it's still cheaper than what it would cost in API fees.

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#112

Post by watwut »

nemo44x wrote: post #57
0zemp3c wrote: post #30

Earlier quoted context omitted.

99.99% of reddit users have no idea who spez is and probably wouldn't care if they learned about his shenanigans 99% of reddit users are aware that moderators do some nice volunteer work but wouldn't cross the street to save them its only Extremely Online people who care about this Insider Baseball stuff

> its only Extremely Online people who care about this Insider Baseball stuff I think this is the case for many things. And I imagine people will/are get wise to it. Elon Musk I think figured this out when he did what he did with Twitter. Some very online people really cared and made a lot of noise and the very online part of the media that cares made a lot of noise. But those people don't really matter and the media…

It really does not seem to me that Musk figured anything out. He is loosing both money and users at massive speed.

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#114

Post by ericbarrett »

judge2020 wrote: post #87
redmerchant2 wrote: post #7

They buried the lede. The article suggests the shutdown was because of free API to paid API. Anyone uninformed who just click off at that point. Even when they ask about costs, it was just saying it’s “ But the issue is two fold. (1) all the devs support a paid API, but the rate is absurd according to basic math. It would charge devs over 20x what a user actually cost/were worth. Devs were willing to take on a higher…

In one of Christian's posts, reddit agreed that the price was for the opportunity cost of serving that user without ads - since they're not going to get any ad money from these users (and are unwilling to serve ads to these 3p clients since they probably can't guarantee to advertisers the 3p app isn't doing anything shady like hiding the ad while logging an impression).

Something I've been wondering—why couldn't the API just send a batch of ads to be served with the content? Since the apps need an authorized API key, if they don't cooperate in showing the ads then Reddit could simply threaten revocation.

Then users who want "premium" could pay for whatever feature Reddit-side to allow an ad-free experience, or they could even partner with the third party apps to offer it for a cut of the fee.

(This is assuming Reddit is negotiating in good faith, though that seems to be in question.)

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#115

Post by NoMoreNicksLeft »

causi wrote: post #8

I would like a breakdown of Reddit's actual costs vs their proposed fees. Why isn't Reddit profitable? Is there a way to make Reddit profitable without charging for API access?

No, there is no way to make it profitable, even with charging. They said that they were going to charge him something like $20 million a year... there are 3 or 4 other similar apps.

Does anyone believe that even with $60 million a year, they'd become profitable?

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#116

Post by tmpz22 »

more_corn wrote: post #70
spiderice wrote: post #37

Earlier quoted context omitted.

The obvious places to start are: 1. Do charge for API access. But be reasonable. Nobody is calling for free api access. Charge like 2-5x their cost of operation. Not 20x. 2. Serve ads to third party apps through the API. This is a no brainer. The fact that they aren't doing this speaks volumes about their true motives with this move.

These obvious places to start would have needed to take place months ago before the decision was made, before the deadline set, before management dug in. Before the revolt. What are the obvious places to go from here and now?

> What are the obvious places to go from here and now?

Act like adults. Admit mistakes. Change policies. Rebuild trust through honest and prompt communications.

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#117

Post by jyxent »

paxys wrote: post #49
redmerchant2 wrote: post #7

They buried the lede. The article suggests the shutdown was because of free API to paid API. Anyone uninformed who just click off at that point. Even when they ask about costs, it was just saying it’s “ But the issue is two fold. (1) all the devs support a paid API, but the rate is absurd according to basic math. It would charge devs over 20x what a user actually cost/were worth. Devs were willing to take on a higher…

> It would charge devs over 20x what a user actually cost/were worth Are you implying that a user is worth $0.125/mo to Reddit? Because that is laughably inaccurate. Mature platforms like Facebook extract up to $60 per user per quarter in advertising revenue from developed countries. Reddit itself made an estimated $500M+ from ads last year. ~$2.50/mo is already more than fair. Thinking that Reddit owes full data acc…

Reddit reported that they had 430 million monthly active users in 2019.

$500 million per year / 430 million users = $1.16 per user per year

$1.16 / 12 months = $0.10 per user per month.

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#118

Post by caturopath »

jarym wrote: post #22
redmerchant2 wrote: post #7

They buried the lede. The article suggests the shutdown was because of free API to paid API. Anyone uninformed who just click off at that point. Even when they ask about costs, it was just saying it’s “ But the issue is two fold. (1) all the devs support a paid API, but the rate is absurd according to basic math. It would charge devs over 20x what a user actually cost/were worth. Devs were willing to take on a higher…

Also the normal way to introduce pricing to free services is to make it initially super-cheap so the majority will find it reasonable. Then overtime increase prices as you get a better sense of value and market dynamics. Starting high, creating a lot of negative reactions and almost killing any real market for profitable apps on your platform seems to be the opposite of smart. It’s now some governments go with taxati…

It seems like they must have thought their best bet was driving out third-party apps altogether, and the best approach was to pull the band aid off as fast as possible

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#119

Post by programmarchy »

Here’s some tinfoil. Maybe OpenAI (or some other data hungry org) made a deal with Reddit to build up their data/training moat. Announcing this would have an even bigger backlash than what we’re currently seeing, and could explain why Reddit would shut down API access in such a hamfisted but plausibly deniable matter.

To substantiate this a bit, Microsoft already had a pre-existing relationship with Reddit since 2017 [1] to augment their capabilities with Bing and their “BI” tools. They could be leveraging that relationship to boost their investment in OpenAI.

[1] https://www.redditinc.com/blog/reddit-microsoft-power-bi-bin...

Re: Apollo’s Christian Selig explains his fight with Reddit – and why users revolted

#120

Post by phire »

joecot wrote: post #56
jarym wrote: post #22

Earlier quoted context omitted.

Also the normal way to introduce pricing to free services is to make it initially super-cheap so the majority will find it reasonable. Then overtime increase prices as you get a better sense of value and market dynamics. Starting high, creating a lot of negative reactions and almost killing any real market for profitable apps on your platform seems to be the opposite of smart. It’s now some governments go with taxati…

> Starting high, creating a lot of negative reactions and almost killing any real market for profitable apps on your platform seems to be the opposite of smart It's really dumb if the point is to keep all the third party applications that made your platform popular. It's much smarter if the point is to kill them all in favor of your first party app, that you are promising your VC investors will have tremendous growth…

It seems like the plan was always to kill the 3rd party apps, but not until their own app was feature competitive with the 3rd party ones.

But they ran into time limitations. They plan to IPO later this year and they want the 3rd party apps to be dead before then.

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