Reddit's CEO speaks up about controversial API changes

Social media site Reddit's co-founder and CEO, Steve Huffman, has come out to publicly defend the company's Application Programming Interface (API) changes which has been heavily criticised by the community for its high pricing and for its potential to force the closure of many third-party apps as it looks to become a self-sustaining business, according to Huffman. 

"Reddit needs to be a self-sustaining business, and to do that, we can no longer subsidise commercial entities that require large-scale data use," he wrote in a thread on the site. 

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He then went on to clarify some of the changes and what they will mean for moderators and developers. "Effective 1 July 2023, the rate limits to use the Data API free of charge are 100 queries per minute per OAuth client id if you are using OAuth authentication and 10 queries per minute if you are not using OAuth authentication," he wrote. He noted that today, over 90% of apps fall into this category and can continue to access the Data API for free. 

Essentially, this means that come July, the rate for apps that require higher usage limits will be US$0.24 per 1K API calls. Huffman then noted that some apps, such as Apollo, Reddit is Fun, and Sync have decided this pricing "doesn’t work for their businesses" and will close before pricing goes into effect.

For the other apps, we will continue talking. We acknowledge that the timeline we gave was tight; we are happy to engage with folks who want to work with us.

Huffman also acknowledged that many communities rely on tools like RES, ContextMod, Toolbox. He confirmed that these tools will continue to have free access to the Data API and that it is working together with Pushshift to restore access for verified moderators. 

"We want everyone to be able to use Reddit. As a result, non-commercial, accessibility-focused apps and tools will continue to have free access. We’re working with apps like RedReader and Dystopia and a few others to ensure they can continue to access the Data API."

Hoffman was speaking out after Christian Selig, the developer of third-party app Apollo took to Reddit to reveal that he might soon have to shut down his app because of Reddit's changes to its API pricing system. 

In his post on Reddit last week, Selig argued that Apollo, made "seven billion requests" last month which would put it at about 1.7 million dollars per month, or 20 million US dollars per year. 

 "Even if I only kept subscription users, the average Apollo user uses 344 requests per day, which would cost $2.50 per month, which is over double what the subscription currently costs, so I'd be in the red every month," he said. 

"I'm deeply disappointed in this price. Reddit iterated that the price would be A) reasonable and based in reality, and B) they would not operate like Twitter. Twitter's pricing was publicly ridiculed for its obscene price of $42,000 for 50 million tweets. Reddit's is still $12,000. For reference, I pay Imgur (a site similar to Reddit in user base and media) $166 for the same 50 million API calls."

He noted that for Apollo, the average user uses 344 requests daily, or 10.6K monthly. With the proposed API pricing, the average user in Apollo would cost $2.50, which is 20 times higher than a generous estimate of what each users brings Reddit in revenue.

"This is going to require some thinking. I asked Reddit if they were flexible on this pricing or not, and they stated that it's their understanding that no, this will be the pricing, and I'm free to post the details of the call if I wish," he said. 

The news comes shortly after Reddit revealed that it will be letting go of approximately 5% of its workforce, equivalent to 90 employees, last week. 

According to The Wall Street Journal, Steve Huffman, chief executive of Reddit, said that the company would subsequently reduce hiring to about 100 from the initial plan of 300 for the year 2023. This is an attempt to break even next year.

“We’ve had a solid first half of the year, and this restructuring will position us to carry that momentum into the second half and beyond,” says Huffman in his email to staffers last week.

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