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this post was submitted on 08 Jun 2023
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How much were these apps making in revenue? Curious how bad the gap is with the API pricing.
If I read it correctly Christian(Apollo Dev) made ~$500.000 for this year by having 50.000 people get the $10 subscription. The problem is that now, since on the 6th month of the year he is forced to shut it down, he has to refund these people for the rest of the money(so ~$250.000).
From what I understand though, the problem is that Reddit doesn't want to lose revenue from 3rd party apps avoiding adds, so in this section, from Christian's own recording(which is legal in Canada) he mentions that Apollo is costing $20m/year and that's what Reddit is after.
At least, I understood it in some other way.
With some "back of the envelope" calculations (using Reddit provided revenue and user number) Reddit's revenue (not earnings) / user month is $0.12 , around $1.4 user/year
In the case of Apollo, the "intended" revenue per Apollo user would be $2.5 per user month, around $30 user /year
From the body of the post, search for the following header: Why do you say Reddit's pricing is "too high"? By what metric?
The $20 Million is what would cost to continue using the API with the intended price point.
Also, $500.000 year would be revenue, not earnings. As I understood, he's not a "solo" developer working in his basement. There's people and infraestructure to pay from that number (I don't know neither how many people nor how much costs "keeping the lights on", but anyway, I don't think those numbers are relevant)
My own opinion: Let's say Reddit's break even point is around the Apollo's intended cost / user. That would mean that with a revenue of $0.12 per month * user, Reddit would be losing around $800 million / month. That's close to $10.000 million / year. Even as a ballpark figure, I find it suspicious to say the least.
BTW: I've never used Apollo. RIF user from long long before they had to change the App name