this post was submitted on 11 Jun 2023
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Asklemmy
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I suspect reddit's reported unprofitability isn't due to the cost of hosting, but from blowing money in other ways.
I read they have 2000 staff members, why so many? The moderation is done by volunteers, just seems excessive.
We don't even know for a fact if they are truly unprofitable or not, it's not like anyone here has reviewed their books.
No, but it would be extra stupid for Spez to say that if it weren't true because it could affect investments and draw legal action.
Honestly, who knows at this point? I've seen some horrible business/legal decisions happen over the last 5-10 years. Some people will practically set themselves on fire just for the chance to make higher profit. Hypothetically, this certainly wouldn't be the first case of a sketchy business drawing bad legal attention to itself, not by a long shot. I have seen a lot of businesses shut because of this type of behaviour.
The other lies from Spez about the developers certainly don't help his case, either. That's another fantastic way for Reddit to open themselves up to potential legal issues.
I wonder how much reddit wasted on the nft avatar garbage.
Yeah cocaine and hookers don't come cheap
Any "good" corporation is supposed to be "unprofitable", i.e. investing all their income into future growth.
And if you believe that the money you invest in your business will outperform usual loan interest rates, then it also makes sense to take out loans for even more growth, since then loan interests will be paid by future profits that compounds from the growth you get by taking out the loan.
Of course, usually that doesn't work, so the CEOs and whoever tries to cash out before the eventual crash.
Depends if how much it's growing. Amazon puts everything back into growth, but someone like Apple doles out tons and tons of money to shareholders. Investors buy into things like Amazon because they're supposed to eventually become Apple.
Back in the day, Reddit used to show how much of their server costs were being covered by Reddit gold revenue alone. It was basically always enough to cover daily usage.
Hookers and blow, right? It's always hookers and blow
Their hosting costs also rose exponentially when they decided to host their own videos and pictures.
Yea, lemmy is volunteer run, so most of the cost is going to be hosting it would seem, unlike reddit who have to pay for employees/office space(?)/legal fees/ect. I would imagine that the larger instances will have the most problems paying for hosting while the small ones will probably be fairly cheap.