Reddit will charge hefty fees to the many third-party apps that access its data

Reddit, the 18-year-old social media and news aggregation site, is demanding developers pay thousands of dollars to directly access the company’s data and content, a move that could help pull in a more diversified source of revenue.

The company, which first disclosed plans for an IPO in late 2021, is asking developers to pay $12,000 per every 50 million requests, according to a post from the creator of a popular third-party app called Apollo. The developer said the number was “deeply” disappointing.

“Apollo made 7 billion requests last month, which would put it at about 1.7 million dollars per month, or 20 million US dollars per year,” the developer said in a Reddit post about the change.

Reddit is majority owned by Advance Publications, the parent company of Conde Nast and a major shareholder in Charter Communications and Warner Bros. Discovery.

Application programming interfaces have long been the way third parties access data from large internet companies and connect to their apps. Reddit has a thriving ecosystem of apps, plugins and services created by amateur and professional developers.

API costs have gained greater attention since Elon Musk assumed ownership of Twitter and since new artificial intelligence-powered tools made their way into products used by millions of people. Modern AI programs use large language models, which train themselves on mountains of web-based content, including from user-generated posts on sites such as Twitter and Reddit.

Users and developers were outraged when Twitter said it would charge $42,000 for 50 million requests. Apollo’s developer said despite Reddit’s promise to avoid that kind of extreme pricing, the company price is “still $12,000.”

Apollo said it paid about $166 for the same number of API requests from the online image-sharing service Imgur.

While many companies charge for API use, Reddit has historically derived the bulk of its income from advertising. But relative to its peers such as Facebook, Snap and Pinterest, Reddit has struggled to monetize its active user base.

With the digital ad market facing a slowdown and Reddit now 18 months removed from the notification of its confidential IPO filing, the company may be facing pressure to bolster its revenue.

Reddit appears committed to the API pricing. The Apollo developer said the company had no problem with the post.

Reddit didn’t immediately respond to a request for comment.

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