The API pricing was by request. $2.50/user/month was the estimate that the developer of Apollo made based on how many API requests each user of his app made.
They were charging by request. IIRC the $2.50 figure was arrived at by taking the total number of requests and dividing it by the total number of users.
Yeah but the worst thing about it was the timescale. Most of the 3rd party apps would have choked down the cost if they had the time to transition. Reddit's true intention was made plain by giving them just 30 days to do so, while also removing NSFW content.
the actual price Apollo charged would likely have to be much higher. The average number of API calls for the users who are deep enough into reddit addiction to be willing to pay for it would be substantially higher without the casual user who views 10 pages a month to average it out.
The problem is casuals are not going to pay, only powerusers would pay and they're making hundreds of calls per day/thousands per month. Take that $2.50 number and 10-100x it, and then add in App Store payment processing costs.
Yeah I think they can set a general price, but for big hitters like Apollo they figure out what makes sense.
So yeah, I agree reddit is probably just trying to get rid of the app competition. I just can't believe any serious analysis led them to think this was the right pricing.
And Reddit already sells Reddit Gold, users could pay with it for the privilege to use the API on any third-party client. Everything so far points as Reddit deliberately killing third-party apps.
I also don't totally get why "by user" is how they wanted to charge. Wouldn't charging by request make more sense?