I keep thinking this would have been a much better sell to devs and to users. I have always used Sync, and Boost. I tried the official app a few times, but really only used it for the chat feature. I didn’t want to pay for it, but (I am embarrassed to admit it) I would pay premium to keep my app. I think this would have worked out better for Reddit than the garbage they are pulling right now.
Would that have been a more reasonable solution in your opinion as well?
You’re ignoring the other effects of third party apps - which is to have significantly added to the number of users they have to show ads to in the first place.
Making their API free encouraged active development which increased user engagement. So it absolutely did increase their revenue because it helped to increase the popularity of their site in the first place.
Users that likely will never see an ad of they only use the 3rd party app
This.
Put more explicitly:
3rd party apps bring more people to the site, or keep them there longer.
Those people create content in the forms of posts proper and comments— hell, even down to just voting— that feeds the site engagement for users through 1st party interfaces(the ones getting ads), keeping them there longer, and seeing more ads.
Better moderation tools help mods keep online communities healthy, and the kinds of places we are happy to spend unhealthy amounts of time on.
Lest we forget how dumb reddit is, they didn’t have a mobile strategy in 2014, which necessitated buying Alien Blue.
If you look at the history of reddit, it has succeeded entirely in spite of management decision. Gotta say, even being on the site since 07-08, even I got this wrong. I expected reddit to do something dumb, I just didn’t expect them to do the most dumb thing.