That wasn't my understanding of things based on what Christian posted. He didn't want to charge $5 or $10 per month because he didn't think anyone would pay that much so he didn't even try to see what would happen.
Why can't you just charge $5 a month or something?
This is a really easy one: Reddit's prices are too high to permit this.
It may not surprise you to know, but users who are willing to pay for a service typically use it more. Apollo's existing subscription users use on average 473 requests per day. This is more than an average free user (240) because, unsurprisingly, they use the app more. Under Reddit's API pricing, those users would cost $3.52 monthly. You take out Apple's cut of the $5, and some fees of my own to keep Apollo running, and you're literally losing money every month.
And that's your average user, a large subset of those, around 20%, use between 1,000 and 2,000 requests per day, which would cost $7.50 and $15.00 per month each in fees alone, which I have a hard time believing anyone is going to want to pay.
For me, this was always why I couldn’t get behind the protests.
There are several other Reddit apps that have said they’ll charge a monthly subscription and continue providing software.
Surely, the largest (I assume, based on all the drama) iOS app for Reddit could have come up with a pricing model that made sense.
He says these power users use too many API requests and he doesn’t believe anybody will pay that amount.
First, if they’re power users, they will. They won’t like it, but if they spend 8 hours a day on Reddit making hundreds of API requests, they’ll likely pay.
Second, either he’s very dumb, a horrible businessman, or he thinks everyone else is brain dead.
In his examples he quotes the average API requests from power users and says they won’t pay that but they don’t even need to. There will be tons of people that pay but don’t come anywhere near the top numbers.
It’s like a gym. If everyone that bought a membership used the gym the gym wouldn’t be able to handle the number of people. But, like most things, one group uses it a lot and some people go once or twice and never come back.
His numbers don’t make sense.
Third, he could offer Apollo on a monthly subscription but say that $5 a month gets you X API requests per month. Go over that and you pay more. Or he can have different tiers which allow more API calls. It’s how MidJourney works and a lot of other services.
Bottom line, having been in the business world for over 30 years, I’ve never seen someone throw up their hands and walk away from a profitable business without at least trying to make it work.
I’ve been making the prediction that this was all either a big PR stunt to benefit Apollo’s or it snowballed out of control.
I think he wrote that post and he rattled the cages at the tech media companies thinking Reddit would cave easily but when they didn’t he was stuck holding the bag and now had to justify why he was killing Apollo when he had other options available to him.
In fact, I’ve been wagering with some friends that before 2023 is through, he relaunches either Apollo or a similar product and claims he figured out a way to make it work.
All the Apollo fanbois will throw money at him and call him a hero for standing up to Reddit and he’ll make plenty of money.