Did Reddit's API move kill its web3 plans?
Biting the hand that feeds it doesn't bode well for social platforms...
Look, Reddit deserves to make money, and a move like this ahead of an IPO is pretty common. But the decision to shut off API access to third party developers unless they pay fees (similar to Twitter—hey how's that going btw?), tacitly signaled to its community and devs who build for them that they're not as open to open ecosystems as you'd expect.
Which is weird.
Especially for a platform who has made major pushes into the on-chain world. Reddit never pitched the Avatars or its other plans as a decentralized web3 haven, per se. But it did say of its blockchain-based Community Points program,
"Over time, your community will benefit from even greater control and independence—on and off of Reddit."
Huh.
That sure sounded like the beginning of a system that would benefit from activity supported in third party apps. Activity that could signal engagement to brands. Brands who want to spend ad dollars.
Let's say, for example:
A sneakerhead subreddit community does most of its posting and upvoting on a third party app that's better suited to the hobby
Upvotes/karma are represented in Community Points
Which are instantly recognized on Reddit itself, in addition to the Avatars of the users
Reddit uses those immutable engagement metrics to partner with Puma who will pay Reddit for access to the community, and offer benefits to the power-user Avatar-owners and influencers in the community
In an Epic-like move, Reddit could even reward the third party developers with a share of the Puma profits for facilitating all this engagement.
In this way, Reddit positions itself as a rent-a-loyalty-program driven by the (currently) unpaid mods and creators who make Reddit an active and thriving platform. And in a world where cookies and other trackers are waning, having an on-chain way to determine attribution of a sale made directly via a Reddit-based event (or verified user) can set up Reddit to participate in meatier affiliate revenue instead of ad spend alone.
But forcing the end of 3rd party apps doesn't seem like a move in that direction. It also doesn’t keep pace with an industry in which everyday users are increasingly skeptical of how their data and content are used to drive revenue in a system in which they don’t participate.
We still don't know where the company is headed with the millions of NFTs it's brought into the hands of the masses, but squashing flexibility for builders and members isn't something that jives with the ethos of the on-chain life and, I think, will cause external partners and developers to think twice before wanting to rely on any of its web3 components.