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Realistically, the price he would need to increase to isn't even that high. $5 a month. Paying $5 a month for an app you use daily, repeatedly to the point it m

Realistically, the price he would need to increase to isn't even that high. $5 a month. Paying $5 a month for an app you use daily, repeatedly to the point it makes 300 API requests - isn't asking that much. Would all his users pay? No. But they can use the free Reddit app with ads and what not or the website. But realistically, it's easy to think 5-10% would pay. And he would make a healthy profit and Reddit would get paid. The problem, everyone seems to think Reddit doesn't provide enough value to be worth $5 a month to enjoy without ads and a nice UI. Reddit wants about $0,00024 an API request. To think that isn't reasonable, seems odd. Sendgrid wants $0.0399 per email. ScrapingBee wants $0.098 an API request. Docraptor wants $0.4 an API request/pdf. I'm sure I could carry on and find more and more sites that cost more per API request, I didn't find one that was cheaper.

sli 3y ago
Much more than $5, closer to $10. He still has to afford to live, as he currently does with Apollo's current subscriptions, plus pay reddit's API costs. This is according to his comments on reddit about this situation. $10/month to use a free website on your phone is just not a very attractive deal at the end of the day.
- that_guy_iain 3y ago
  Your numbers are wildly outthere. $2.50 would be the API costs per user. So $5 would cover, take in some money and pay appstore feeds. And if you're looking at 10% of his userbase, that would be about 4 million a month income with 2 million being for Reddit. Based off his claims of 20 million a month with a $2.50 cost per user. I'm sure he'll be able to survive off $1,000,000 a month profit. Edit corrected the numbers: $2.50 a user for API costs. $5.00 a month subscription would cover that cost. $1.50 going to AppleTax. $1.00 a user to the indie hacker If 5% of users that would cost $20MM sign up for $5 a month it would be $2,000,000 a month overall revenue. $1,000,000 to Reddit. $600,000 to AppleTax $400,000 a month to the indie hacker.
  - bee_rider 3y ago
    I don’t know about the specifics of the business to intelligently critique your calculation, but it couldn’t possibly be the case that somebody turned down an easy million dollars a month, right?
    - that_guy_iain 3y ago
      If I was to guess, the standard indie hacker thought is happening "I can't raise prices" and "lots of people don't want to pay". When they're seeing 90% of their user base say I'm not paying that, it's easy to forget the 10% that would. The 10% that would probably haven't even spoken up. And there is also probably a part of him that doesn't want to be greedy. But is it greedy to sell your software for $5 a month? I don't think so.
      - bee_rider 3y ago
        Is the 10% based on anything (I figure this is Hackernews so it is non-zero chance that you or someone else knows something about conversation rates for these kind of apps). My gut thinks it is high but I have 0 experience.
        that_guy_iain 3y ago
        10% is a low estimate based on conversion rates I’ve seen people post on conversion rates. Standard apps with freemium the rates are 1-10%, Reddit however is used a lot so a mobile app will be used daily (900,000 daily users out of 1.2 million overall) it already converts at 1.50 a month. It would be somewhat reasonable to think Spotify-conversion rates of 30% would convert.
        bee_rider 3y ago
        That’s pretty good. Dang, maybe there’s room to make a Reddit app, haha.
  - ta_6104828 3y ago
relix 3y ago
It’s 0,00024 per request
- that_guy_iain 3y ago
  Thanks for correcting me.
TheOtherHobbes 3y ago
Reddit could just charge its users $5 a month, offer a $10 a month tier for some extra features and co-offers, and keep the API free. It's a spectacularly stupid move, almost on a par with Musk >50% of Twitter's value and Waves trying to force their customers onto a subscription model by making old versions obsolete. Reddit will lose a huge number of users, its brand will be trashed, and the app companies will be forced out of business. There is no way this can't end up as a net loss.
- that_guy_iain 3y ago
  This doesn't make sense. Make me, a user of their app and website who sees ads and other stuff pay money so that the API users can avoid them? Reddit will lose a bunch of deadbeat users, who generate little to no income for the company but cost money to serve. In business, these are the sort of people you don't want. Who do you think will spend hundreds of millions a year to replace Reddit so that deadbeat users can use it? There would be no money in serving those users and any attempt to serve them and monetize later will result in the same thing that is happening at Reddit. The days of VCs burning money for social networks seems to be over.
  - zipperhead 3y ago
    It's not so simple These "deadbeat users" are the ones generating the content.
    - that_guy_iain 3y ago
      Do they? Most content is reposts, news, or content from other sites. I would suspect Reddit has done the maths. And saw that most content generators use their app or the website to post.
      - garbagecoder 3y ago
        I'm going to say [citation needed] on the assumption Reddit is capable of doing math. They have almost never made a good decision.

sli 3y ago

Much more than $5, closer to $10. He still has to afford to live, as he currently does with Apollo's current subscriptions, plus pay reddit's API costs. This is according to his comments on reddit about this situation. $10/month to use a free website on your phone is just not a very attractive deal at the end of the day.

that_guy_iain 3y ago
Your numbers are wildly outthere. $2.50 would be the API costs per user. So $5 would cover, take in some money and pay appstore feeds. And if you're looking at 10% of his userbase, that would be about 4 million a month income with 2 million being for Reddit. Based off his claims of 20 million a month with a $2.50 cost per user. I'm sure he'll be able to survive off $1,000,000 a month profit. Edit corrected the numbers: $2.50 a user for API costs. $5.00 a month subscription would cover that cost. $1.50 going to AppleTax. $1.00 a user to the indie hacker If 5% of users that would cost $20MM sign up for $5 a month it would be $2,000,000 a month overall revenue. $1,000,000 to Reddit. $600,000 to AppleTax $400,000 a month to the indie hacker.
- bee_rider 3y ago
  I don’t know about the specifics of the business to intelligently critique your calculation, but it couldn’t possibly be the case that somebody turned down an easy million dollars a month, right?
  - that_guy_iain 3y ago
    If I was to guess, the standard indie hacker thought is happening "I can't raise prices" and "lots of people don't want to pay". When they're seeing 90% of their user base say I'm not paying that, it's easy to forget the 10% that would. The 10% that would probably haven't even spoken up. And there is also probably a part of him that doesn't want to be greedy. But is it greedy to sell your software for $5 a month? I don't think so.
    - bee_rider 3y ago
      Is the 10% based on anything (I figure this is Hackernews so it is non-zero chance that you or someone else knows something about conversation rates for these kind of apps). My gut thinks it is high but I have 0 experience.
      - that_guy_iain 3y ago
        10% is a low estimate based on conversion rates I’ve seen people post on conversion rates. Standard apps with freemium the rates are 1-10%, Reddit however is used a lot so a mobile app will be used daily (900,000 daily users out of 1.2 million overall) it already converts at 1.50 a month. It would be somewhat reasonable to think Spotify-conversion rates of 30% would convert.
        bee_rider 3y ago
        That’s pretty good. Dang, maybe there’s room to make a Reddit app, haha.
- ta_6104828 3y ago

relix 3y ago

It’s 0,00024 per request

that_guy_iain 3y ago
Thanks for correcting me.

TheOtherHobbes 3y ago

Reddit could just charge its users $5 a month, offer a $10 a month tier for some extra features and co-offers, and keep the API free. It's a spectacularly stupid move, almost on a par with Musk >50% of Twitter's value and Waves trying to force their customers onto a subscription model by making old versions obsolete. Reddit will lose a huge number of users, its brand will be trashed, and the app companies will be forced out of business. There is no way this can't end up as a net loss.

that_guy_iain 3y ago
This doesn't make sense. Make me, a user of their app and website who sees ads and other stuff pay money so that the API users can avoid them? Reddit will lose a bunch of deadbeat users, who generate little to no income for the company but cost money to serve. In business, these are the sort of people you don't want. Who do you think will spend hundreds of millions a year to replace Reddit so that deadbeat users can use it? There would be no money in serving those users and any attempt to serve them and monetize later will result in the same thing that is happening at Reddit. The days of VCs burning money for social networks seems to be over.
- zipperhead 3y ago
  It's not so simple These "deadbeat users" are the ones generating the content.
  - that_guy_iain 3y ago
    Do they? Most content is reposts, news, or content from other sites. I would suspect Reddit has done the maths. And saw that most content generators use their app or the website to post.
    - garbagecoder 3y ago
      I'm going to say [citation needed] on the assumption Reddit is capable of doing math. They have almost never made a good decision.