As Reddit pushes through their period of crisis, their CEO, Steve Huffman, seems to be influenced by Elon Musk, Twitter’s owner. Reddit is tackling a crisis where many communities went dark after the company announced changes in the API pricing, which was free until now. This has pushed many third-party apps like Apollo, Sync, and Reddit is Fun (RIF) to the verge of shutting down. In the past, Twitter has experienced mass layoffs, firings, and resignations as the microblogging site was taken over by Elon Musk.
Also Read: Reddit crisis explained: Full timeline of events, why it went dark, and what happens next
Recently, Steve Huffman was seen applauding Elon Musk’s efforts towards aggressive cost cutting and layoffs on Twitter in an interview with NBC News. Huffman claimed that he has chatted with the Twitter CEO a handful of times on the agenda of “running an internet platform.” Further, the Reddit CEO asserted that he saw Musk’s handling of Twitter as an example to follow.
Huffman further added, “Long story short, my takeaway from Twitter and Elon at Twitter is reaffirming that we can build a really good business in this space at our scale.” He asserted, “Now, they’ve taken the dramatic road, and I guess I can’t sit here and say that we’re not either, but I think there’s a lot of opportunity here.”
Twitter has been significantly reducing costs and terminating thousands of employees since Musk took control. According to reports, Twitter Inc.’s CEO gave his employees instructions to reduce the infrastructure’s cost by $1 billion. Furthermore, according to reports, the business was trying to reduce spending on servers and cloud services by anywhere from $1.5 million to $3 million every day. Reuters examined an internal memo that said Twitter was losing over $3 million every day as a result of all its expenditures.
Such infrastructure reductions could put Twitter’s website and mobile app in danger and increase the likelihood that they will go offline during situations where an unusually high volume of users converge on the site to share and consume information, such as during any political crisis.
Huffman is taking this as an example and is pushing for Reddit to become profitable by announcing certain changes to API pricing.
As part of their demonstration this week, many moderators who oversee the communities that make up the website shut off a sizable portion of Reddit, rendering it unavailable to the majority of users. The demonstration is a reaction to Huffman’s business strategy, which may involve charging other internet businesses a lot of money for access to Reddit data.
According to Huffman, there is one specific area in which Musk’s example has been obvious: employment layoffs. He claimed that despite having $5.1 billion in revenue in 2021, Twitter’s prior management frequently questioned why the company had trouble maintaining constant profitability.
Also Read: Reddit says 80% of top subreddits online after days of protest over API fees
In a statement, Huffman said, “As a company smaller than theirs, sub-$1 billion in revenue, I used to look at Twitter and say, ‘Well, why can’t they break even at 4 or 5 billion in revenue? What about their business do we not understand?’ Because I think we should be able to do that quite handsomely.”
However, according to Huffman, 80% of the communities are back online, and the company has no plans on backing down from its decisions.
