Reddit Destroys Itself
June 16, 2023
More than two years after Reddit users indulged themselves in a stock market fiasco at the expense of traders shorting Gamestop, the social media giant finds itself in another mess. Founded eighteen years ago by so-called techno-libertarians, Reddit has become a staple platform for internet surfers today.
Despite possessing a significant user base, Reddit has yet to match, or even come close, to the revenues generated by its competitors. Reddit has reported nine-figure annual earnings in recent fiscal years while competitor Meta(parent company of Facebook and Instagram) saw over 100 billion. In an effort to begin closing the gap, Reddit recently announced that it would impose a number of restrictions on its application programming interface(commonly referred to as API). An API is a mechanism by which computer programs communicate with each other.
Reddit allows third-party entities to utilize their APIs through moderator tools accessibility options, and other apps. Some of these services permit users to access Reddit content while bypassing advertisements. As per its new API guidelines, Reddit will start to charge fees for third-party entities using data above a certain threshold but will exempt the regulations for moderator tools and other essential services. The move was made in response to the overwhelming net losses incurred by the company, which it blames on its high API data usage by third-party companies that do not sustain any of the costs.
Moderators are independent users responsible for voluntarily enforcing the rules for individual threads or “subreddits” on the Reddit platform. They hold a tremendous amount of power over the Reddit community with respect to content moderation. In response to the new rules announced by Reddit, moderators of over three thousand subreddits took their channels “private” which meant that large swathes of Reddit content are now restricted or completely unviewable by Reddit users.
As a response to the widespread blackouts, Reddit CEO Steve Huffman affirmed in an NBC interview that he would not back down from the new policies and instead enact a new set of measures “democratizing” the site. Specifically, he aimed to restrict moderators’ power by allowing subreddit members to vote out moderators as they saw fit. Currently, Reddit moderators can only be removed by themselves, higher-level moderators, and Reddit administrators(employees who work for Reddit).
The discord sown in the social media platform is part of a growing trend of technology companies to reign in losses and boost revenue. Television streaming service Netflix in recent months similarly began cracking down on password-sharing and users who bypassed the subscription. Twitter took an even more controversial step by enabling Twitter verification status via paid subscription rather than community consensus. Taken as a whole, a drift away from social media and perhaps technology in general is beneficial to younger generations and the development of new frontiers.