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> But Apollo can offer a better experience because they don't have to sell ads... Reddit could require serving their ads as a requirement for API access. Right now there is no way for Apollo to serve reddit ads even if they wanted to.
How would that be enforced?
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But it would be very simple for Reddit to require ads to be served in Apollo. They could say that in order to view a feed of posts at scale, you'll have to include ads that are injected into the feed. They could revoke the API token for any clients which don't do that. In fact, there are plenty of ways for Reddit to get their money back. Simply put, the Reddit CEO definitely wants to kill 3rd party apps. He just know…
Why not simply charge for the API, and let Apollo figure out a funding model that works for them. It could be subscription, it could be going with a different ad server. Having Reddit need to do audits of clients (where the clients could do things like quietly reduce the number of ads you get if you've tipped $9.99 or more - or not serve ads if your ID is on this special list so that friends don't see the ads or use…
That's the key: Reddit and Twitter and Facebook and the like are not selling ads, they're selling you, the user. The users are the product. They're collecting every bit of data about you, building personal profiles. 3rd party apps would never be that intrusive. Delivering eyeballs on ads is not enough.
He’s saying that it costs them $10M/year in “pure cloud spend” to serve 3% of their users. Despite what they say, if you look at requests, it’s obvious that Apollo is more efficient than Reddit’s app. So if he’s telling the truth, that extrapolates to at least $333M of “pure cloud spend” to serve all of their users.
> Interviewer: I don’t know if I agree with the characterization that Apollo is a fully direct competitor of Reddit. > Huffman: Okay, hold on, timeout. You go to the App Store, you type in Reddit, you get two options, right? There’s Apollo. You go to one, it’s my business, and you look at our ads, use our products. That’s 95 percent of our iOS users. The rest go to Apollo, which uses our logo, or something like it, t…
He has a point, no? Sure, there's a middle ground where API access is priced so both Reddit and Apollo make money. But Apollo can offer a better experience because they don't have to sell ads, and if they get a large enough market share they can just start their own Reddit.. the codebase is not an effective moat.
Apollo could pass this on to their users as the fee for ads free Reddit experience.
This way their incentives are aligned with Apollo’s.
Both earn money and are incentivized to grow their user base.
I understand their desire to become profitable as a business, but the way Reddit has gone about this does not fill me with confidence regarding any hypothetical IPO they may be considering. An executive openly attacking community members and developers, some of whom originally wrote the app that Reddit the bought to brand as their official one, as ‘not the intended users’ of the API is just misleading. They clearly s…
So they are making changes, and it doesn't even matter if the changes are most likely very bad for the company. I don't think they are naive to think that reddit can't die and this action would not lead it to that path.
Earlier quoted context omitted.
But it would be very simple for Reddit to require ads to be served in Apollo. They could say that in order to view a feed of posts at scale, you'll have to include ads that are injected into the feed. They could revoke the API token for any clients which don't do that. In fact, there are plenty of ways for Reddit to get their money back. Simply put, the Reddit CEO definitely wants to kill 3rd party apps. He just know…
Curious how would that be implemented. How do you ensure that third party app actually shows the ads?
> Interviewer: I don’t know if I agree with the characterization that Apollo is a fully direct competitor of Reddit. > Huffman: Okay, hold on, timeout. You go to the App Store, you type in Reddit, you get two options, right? There’s Apollo. You go to one, it’s my business, and you look at our ads, use our products. That’s 95 percent of our iOS users. The rest go to Apollo, which uses our logo, or something like it, t…
Earlier quoted context omitted.
He has a point, no? Sure, there's a middle ground where API access is priced so both Reddit and Apollo make money. But Apollo can offer a better experience because they don't have to sell ads, and if they get a large enough market share they can just start their own Reddit.. the codebase is not an effective moat.
They could have just priced the API at: ARPU from Ads on Reddit + some markup for maintaining the API. Apollo could pass this on to their users as the fee for ads free Reddit experience. This way their incentives are aligned with Apollo’s. Both earn money and are incentivized to grow their user base.
Earlier quoted context omitted.
> But Apollo can offer a better experience because they don't have to sell ads... Reddit could require serving their ads as a requirement for API access. Right now there is no way for Apollo to serve reddit ads even if they wanted to.
How would that be enforced?