Reddit filed to go public on Thursday (PDF), revealing numerous particulars of the social media firm’s inside workings. Among the revelations, Reddit acknowledged the specter of future person protests and the worth of third-party Reddit apps.
On July 1, Reddit enacted API rule modifications—together with new, costly pricing —that resulted in lots of third-party Reddit apps closing. Disturbed by the modifications, the timeline of the modifications, and issues that Reddit wasn’t correctly appreciating third-party app builders and moderators, 1000’s of Reddit customers protested by making the subreddits they reasonable personal, read-only, and/or participating in different types of protest, corresponding to solely discussing John Oliver or porn.
Protests went on for weeks and, at their onset, crashed Reddit for 3 hours. At the time, Reddit CEO Steve Huffman mentioned the protests didn’t have “any significant revenue impact so far.”
In its submitting with the Securities and Exchange Commission (SEC), although, Reddit acknowledged that one other such protest could hurt its pockets:
While these actions haven’t traditionally had a cloth influence on our business or outcomes of operations, comparable actions by moderators and/or their communities sooner or later could adversely have an effect on our business, outcomes of operations, monetary situation, and prospects.
The firm additionally mentioned that dangerous publicity and media protection, corresponding to the type that stemmed from the API protests, could be a threat to Reddit’s success. The Form S-1 mentioned dangerous PR round Reddit, together with its practices, costs, and mods, “could adversely have an effect on the dimensions, demographics, engagement, and loyalty of our person base,” including:
For occasion, in May and June 2023, we skilled adverse publicity because of our API coverage modifications.
Reddit’s submitting additionally mentioned that adverse publicity and moderators disrupting the traditional operation of subreddits could hurt person progress and engagement objectives. The firm highlighted monetary incentives related to having good relationships with volunteer moderators, noting that if sufficient mods determined to disrupt Reddit (like they did after they led protests final 12 months), “results of operations, financial condition, and prospects could be adversely affected.” Reddit infamously forcibly eliminated moderators from their posts through the protests, saying they broke Reddit guidelines by refusing to reopen the subreddits they moderated.
“As communities grow, it can become more and more challenging for communities to find qualified people willing to act as moderators,” the submitting says.
Losing third-party instruments could hurt Reddit’s business
Much of the momentum for final 12 months’s protests got here from customers, together with long-time Redditors, mods, and folks with accessibility wants, feeling that third-party apps had been essential to enjoyably and correctly entry and/or reasonable Reddit. Reddit’s personal know-how has disillusioned customers prior to now (main some to cling to Old Reddit, which makes use of an older interface, for instance). In its SEC submitting, Reddit pointed to the worth of third-party “instruments” regardless of its API pricing killing off most of the hottest examples.
Reddit’s submitting discusses dropping moderators as a business threat and notes how necessary third-party instruments are in sustaining mods:
While we offer instruments to our communities to handle their subreddits, our moderators additionally depend on their very own and third-party instruments. Any disruption to, or lack of availability of, these third-party instruments could hurt our moderators’ skill to assessment content material and implement group guidelines. Further, if we’re unable to offer efficient help for third-party moderation instruments, or develop our personal such instruments, our moderators could determine to depart our platform and will encourage their communities to comply with them to a brand new platform, which might adversely have an effect on our business, outcomes of operations, monetary situation, and prospects.
Since Reddit’s API coverage modifications, a small variety of third-party Reddit apps stay accessible. But a few of the remaining third-party Reddit app builders have beforehand instructed Ars Technica that they’re uncertain of their app’s tenability underneath Reddit’s phrases. Nondisclosure settlement necessities and the dearth of a finalized developer platform additionally drive uncertainty across the longevity of the third-party Reddit app ecosystem, in keeping with devs Ars spoke with this 12 months.