“We’ve known for over a decade that people come to Reddit to talk about the products they love – take r/BuyItForLife for example, a community of over 1.5 million redditors who have been sharing recommendations and advice about their lifelong, must-have purchases since 2011. These updates will uplevel the search-and-discover experience for both brands and our users by tapping into our differentiated value as a hub for actionable conversation”
It’s a stupid move from Reddit because all they needed to monetize 3rd party apps was to offer fair API pricing that the 3rd party devs could pass onto their users. Or alternatively tie 3rd party app API usage to having a Reddit premium account which directly brings the money to Reddit.
On a platform heavily built upon the content provided by users, what could happen is that the platform loses the people who were writing good content and retains the people posting fluff - low effort memes, links to clickbait articles etc. That’s going to eventually push away users who were looking for more than that.
On top of that if moderators leave, that leaves the platform open for a flood of spammers, scammers, bots etc which annoys the people still using it, eventually making more leave.
Pushing more ads is just another nail in that coffin.
3rd party apps don’t have the user tracking that the Reddit app has