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

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 taxation before u-turning some years later when they’ve driven away or killed whatever it is they were hoping to tax.

It's unreasonable for a company of any size. The entire storyline shows Reddit sabotaging the process. Which seems idiotic, because they're throwing away a vibrant ecosystem that is #1 in the world, and took a decade to organically grow.

A decent CEO would've made a good faith effort to monetize this rather than burn bridges.

Reddit C-level executives suggested Apollo was poorly optimized or something. I think if it truly costs that much to use Reddit’s API, then maybe it’s on reddit to make their backend more efficient. If that’s not the case then it’s clearly just another case of corporate greed and pumping the numbers for the IPO.

I really hope the blackout is sustained for longer than 2 days. People need a break from social media and their echo chambers. Plus only 2 days of decreased user activity is nothing to Reddit.

It will stay relevant for 1-2 news cycles. C-level executives brush it off to board as “turbulence”. Then it’s back to business of extracting as much value from the users

That's the point. In business you don't say "no" you 'f#ck off' price instead. 20x is a f#ck off price. It's because they don't want 3rd clients to proliferate because of the business issues it creates BUT at 20x, if they agreed, it would benefit the balance sheet enough for the issue to go away.

The TL;DR on this whole situation is that Reddit quoted Apollo and other 3rd party apps their "fuck off" rate, and now Reddit is all like surprised Pikachu face that people who depend on those apps are, well... fucking off.

[0]: https://techcrunch.com/2023/06/08/popular-third-party-reddit...

Edit: $20M/year, not per month.

Let's say Apollo, Relay, or RIF charged $2/mo per user. Would that be enough to cover their expenses?

Looking at Reddit's now API pricing, 100 calls per day per average user would cost $0.72 / month.

Google/Apple App Stores take a 15% commission on subscriptions so a total per month per customer average cost would be $0.83 cents.

That means the devs would make $0.98 cents per month per user on a $2 subscription fee. (30 cents to Google, 73 cents to reddit, 98 cents left to pocket).

With this user base, even if only like 20,000 people subscribe the devs stand to make $20,000 every month in profit.

The Relay for Reddit dev breaks it down here: https://www.reddit.com/r/RelayForReddit/comments/147152b/upd...

Apollo has 1.5 MILLION monthly active users. With a 50% conversion rate (meaning half of the users decide to subscribe) and charging $2.00 a month, he would make $750,000 / PER MONTH. That's with the new Reddit fees.

More: https://www.reddit.com/r/RelayForReddit/comments/147152b/com...

API pricing/use is the excuse to lock down their content asap. They see a goldmine under their own feet that others are extracting value from and so far they have not.

This is all about LLMs and perceived value related to that.

I can only imagine what an app is like that was designed with no API limits whatsoever.

It's kind of amazing Reddit ever allowed this sort of no limits API usage - while at the same time Apollo charged their own users while enjoying zero infrastructure costs. What a steal.

This is Selig's estimate based on not much info. Numbers like "20x" are completely made up.

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 access to anyone for pennies is absurd.

From the article, it says Reddit would charge Apollo $2.50 per user per month. Right now, ad-free YouTube costs $12 a month, ad-free Twitch costs $12 a month. I can't buy ad-free Twitter at any price. Is it really not worth $2.50 a month to have ad-free Reddit?

Personally, I like Apollo, and I would be willing to pay to keep an ad-free Reddit experience. I'm disappointed that the two sides didn't manage to work this out.

I feel like Reddit is getting attacked despite being the company that is trying the hardest to make this work. The standard approach is just to ban apps that compete with the in-house app. Facebook, Twitter, YouTube, Twitch, all of those services just completely forbid things like Apollo. All these complaints are going to encourage companies to simply ban alternate apps rather than trying to price an API in the future.

If they still thought it was a shakedown, it would be honest for them to later say to their team that they thought it was a shakedown.

I don't know how much to trust Reddit, and the 30-days notice to showstopper API fees looks very bad. But I see a lot of people just repeating Tweet-sized soundbites, which leads to a dysfunctional and more easily manipulated society.

https://en.m.wikipedia.org/wiki/Reddit (see controversies section)

> Even spez complaining about Christian recording the calls seems hollow when those recordings are what proved that spez was lying to the community

Were the calls ever posted? For the way Reddit has handled this and previous issues I definitely believe Christian over spez, but unless I missed something, right now everyone is just believing what Christian said, right?

Edit: I missed it, transcripts and recordings were posted to apollo sub. Thank you to everyone who replied with links

It's like when a person complains that her husband looked at her phone, when by doing so he discovered she was cheating on him.* Where's the trust?

* Genders included for sentence readability, not to imply anything about women or men

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

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 if they want a pro-rated refund on any existing time left in their subscription as Apollo will not be able to afford to continue it, or they can decline the refund if they're feeling kind and have enjoyed their time with Apollo.

> For the curious, refunding all existing subscriptions by my estimates will cost me about $250,000.

There is a vocal amount of non-mods who are also participating.

Also "mods" are still users of reddit. When I'm an admin of a Facebook group, I'm still a 'facebook user'.

What's worse than pissing off the workers of your business is to piss off those who do all the work for free.

The worm is turning and the top power-mods are going to get Caesar'd.

Uff i ve been trying to find them , and also trying to make mine more active but it doesn't seem to be workign ...

I've also decided, screw it, I'm taking an Amazon break as well (because they enable the above behavior, the world is worse because Amazon retail exists, CMV) -- boy, shopping for a particular thing is hard without them. Like, I decided to just order more Eneloop batteries, which stores local to me carry them? Goooooood luck finding that out (and I'm in the bay area). I'd love to shift my Amazon spend locally, but ended up ordering from B&H.

Outside IT it's still prob my main method to research opinions and advice while filtering out all the Google crap.

I think people underestimate the amount of curated info/answers are in reddit subs.

This blackout led me to click on r/popular and .... the horror! i remembered how juvenile reddit is, it s not good

Reddit was clearly not designed as a website that would last for more than 5 years. Now it's all coming to bite them, stagnant communities, powertrippy moderators, impossible to contain etc etc. I m going to need some popcorn going forward

As others have said, the real alternative to Reddit isn't a 1:1 replacement, it's other social media, it's Discord. It's doing anything else with your time.

That's not the way things work anymore. If they think they can charge $10 a user and get away with it they will, regardless of how unethical or deceitful they need to be. And it's not just Reddit, it's our entire world of business "leaders" that have adopted that attitude.

The problem is that you're looking at it from the perspective of what makes a good product, and view 3P apps as part of a good product. However, the only question getting asked by the executives, board members, investors, etc. is "what makes a ton of money?"

Bring back the product focused people IMO.

It seems that the Reddit executive team has decided that killing third-party apps is in its best interest regardless of the probably-to-some-degree-expected backlash. I think Christian's and your conclusion, that Reddit intends for the new pricing to be prohibitive, which indicates that it "is obviously intended to kill third party apps," is fair.

Not a chance. He embarrassed the CEO and most CEOs are the type of people that would rather run the company into the ground than do business with someone that upstaged them.

I'm not saying Apollo is important to Reddit's business, just that you aren't accounting for the hubris of C level executives.

I understand that Christian is in a really challenging place, but fighting with Spez in a public place is not the way to do it. It only encourages other developers to build a following that they attempt to leverage against Reddit.

I'm in a small-ish instance with a great admin/mod team who's values align with mine and who judiciously eject people with bad vibes. (mostly nazi's and transphobes)

I feel no need to share a social network with people who hate my friends for who they are so the whole proposition of uncensored content doesn't appeal to me at all.

Usenet was good as well.

They are trying to extract as much value before their IPO as possible.

It's kind of a funny protest - poor people who watch lots of ads protesting for the rights of rich people to enjoy an ad free experience.

I feel like there's a chance that Reddit comes out from this proving that they're actually already moderating a bunch of content and volunteer mods have no leverage.

It's a small subset of their moderator workforce. Most of them are, in solidarity I guess, continuing on as normal.

This would have the same effect though, almost no one would use it, and that kills the business case for Apollo, and Apollo ceases to exist. Maybe an open source volunteer run client might limp on, but that's it.

It's also super easy to detect these sorts of things and just ban that usage.

Christian even said that if Reddit had given app developers longer -- maybe six months to a year -- it would have been tough to change the business model, but not impossible. With this timetable, he would have had to come up with something like $500k in 30 days just to cover immediate costs, which was obviously impossible.

They did ask for more time for the changes than the given 30 days, and Reddit refused.

That being said, I doubt anyone would use it. $1 per 1k requests is insane.

I'm not exactly sure what counts as an API call, but it has the potential to add up quickly. On initial load, new Reddit makes 209 network requests and old reddit makes 127. I doubt the API needs that many requests, but it's not a nested API. It likely requires a bunch of additional requests to grab accessory information.

It seems plausible that power users would end up easily running into $1 to $5 daily usage fees. Nobody is going to pay $30/month for Reddit plus an application fee.

They are asking for $0.24 per 1,000 API calls. Apollo averages ~345 calls per-user per-day (although some users are much higher), but Reddit claims that other apps are "more efficient" and only use about 100 calls/day.

If we assume 100 calls/day/user, then that's 36,500 calls/year/user, and a user is worth $0.12/year, so to break-even, reddit should be charging about $0.003 per 1,000 API calls, instead of $0.24.

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.

The fact is, advertisements pay better than any amount their users or third-party developers would be willing to bear. This change appears to be more about maximizing that revenue stream (or making it more appealing to advertisers), rather creating a _new_ revenue stream in paid API access.

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

Reddit could easily change their terms in the future to prohibit.

https://youtu.be/Ypwgu1BpaO0?t=1772

> I guess there's an analogy um the way Reddit notifications work just for your inbox like you got a message or something um they work in so far as if I the developer of the app want to um say make sure that you get that notification within 10 seconds I have to be checking Reddit every 10 seconds to go like is there anything new is there anything new? is there anything new? is there anything new? okay. There is okay I'll tell is there anything new and then just repeating that at nauseam so you can imagine if you get a message once a week I'm checking every 10 seconds and then once during that whole week I get that message and then I can send it to you um so 99.99 of those API calls were wasted so we've talked to Reddit like that my friend who works on my server um and myself and I've said like what would be so much better is if we could just kind of keep like a port open with Reddit and say like you just tell us when there's a notification ready and we'll beam it off we don't have to bug you all the time and it's logical right and that's how a lot of services do it it's like an event-based API and um that's just not something reddit's ever uh given us

Note that it does a request every 10 seconds for each user. At the API rate that would be about $0.25 every 3 hours (for each user) to support it.

* https://github.com/christianselig/apollo-backend

It was a surprise to him because (1) his relationship with them was based on Apollo, and (2) Reddit had previously placed him on the "friend" side of the frenemy line based on the community's love for Apollo and the engagement it drove.

Naive people don't record every phone call.

He could say all the things we are thinking, but given the CEO has a history of editing posts on Reddit critical of him, it seems like a bad strategy to have any hope of negotiating with them.

His latest experience seems to be pretty out of line given the longevity of their relationship.

"Naive"? Maybe, but I can cut him some slack.

https://stratechery.com/2019/a-framework-for-moderation/

1. browse topics 2. comment on topics 3. review your history of topics, like favorites, comment histories, etc.

So in an ideal world, you do that with no friction.

But inevitably, you need to introduce some friction in order to be profitable. be it ads, data mining (to sell to ad companies), or outright asking a user to pay to do the above features.

I don't know what route reddit will go, but it will inevitably need to introduce even more friction to be more profitable.

What percentage of posts are actually the creators themselves?

And is it not a fair trade? You're not paying anything to post a link and return the content creator gets massive exposure.

And since both Sam Altman (OpenAI's CEO) and Steve Hoffman are from the Y Combinator gang (nervously looks around), I wouldn't even be surprised if there's some form of rivalry here.

Apparently most of their money is made off ads, and instead of working with 3p's, they thought it easiest to force more ads on users. So it's easier to turn off the API switch than to slowly integrate something with 3P's.

as for NSFW: that's an issue every company with NSFW content has struggled with. It's a paradox where it's very lucrative and companies want that money, but also a huge pain in the neck to compromise with in a legal sense. when you need to pay some employees full time to fight these fights, you have to start wondering if that cash cow is even worth it? When credit card companies start to deny you based on that, that answer becomes very clear.

I'm not sure where this thing about it being a "joke" came from. Reddit accused him of making too many requests (even though he was insanely below the threshold they themselves allotted), and he said he was willing to fit within whatever they wanted as a new threshold, or "keep the app quiet"

Some people make jokes when they are stressed or anxious.

If Reddit buys Apollo, there's zero chance they let it operate independently. Christian gets a nice payout and all his users leave for the next best option. If I'm reddit I don't think I see that as being worth the cost that the app's userbase might be on paper just based on API cost.

The point is there's a middle ground to be had, but rather than negotiating for an outcome both sides can live with, Reddit is just choking third-party apps (many of which provide tooling for moderating at scale or enable accessibility) to death.

that's not saying much when Spez outright said reddit isn't profitable. Yes, a few devs working on an API scaper is cheaper than 2000 employees worldwide, for a company HQ'd in San Fransisco on top fo that (I still can't imagine what reddit needs with 2000 employees).

meanwhile I don't exactly think Spez is surviving paycheck to paycheck himself. If he's not already, he'll easily clear tends of millions of dollars of net worth when Reddit goes public. Or at least, that's what I would have said 4-5 months ago.

>you can't expect to generate profit from another business unilaterally forever and be shocked that they won't allow it.

on the flip side, I don't think Christian is suddenly broke either. Probably not "I can retire in prauge" levels of finances, but he's definitely made a lot of money.

But he's under no obligations to play ball with Reddit, especially when reddit is taking the ball home. I don't see this as him leeching off reddit when you take into account how many users his app brought to the business. Just like how you said RiF is your Reddit, I'm sure Apollo is others' reddit.

>As people have said countless times in other situations where people had issues with reddit; just use another platform.

I agree and am. But that's tangential to this article. Christian isn't exactly trying to kill reddit nor pitch his next Apollo app for the next big platform. He said his dream scenario is to wake up and see the API rates halved and he'll be happy and keep Apollo running. He clearly doesn't want reddit dead.

But as is: he seems more or less done.