HN Explorer

Ask HN: What do you think of Reddit's user supported monetization.

20 points by onedev ↗ HN
So Reddit has really been pushing it's "Reddit Gold" membership thing lately which is mostly a vanity membership with the explicit purpose of "keeping the servers running with support from the community".

They have a little progress bar that resets each day giving users a visual way to see how much support Reddit needs and how much Reddit gold the users bought that day to help towards the progress.

I've been paying attention to this for a couple weeks now, and it seems to be working out really well for them. For example, today they hit 169% of their daily goal...which is awesome to see! The users are voluntarily paying for the site; something that in our ad-driven-and-supported-services world seems to be a crazy notion.

What do you all think about this? Can any Reddit devs or employees chime in? Has anyone tried anything similar to this before?

16 comments

[ 5.0 ms ] story [ 29.8 ms ] thread
jackhammons
I think it works because some people feel a direct benefit from the services a gold account provides. Others feel that because they are on Reddit a lot they should be contributing to it. In the future I see the potential for a structure much like Wikipedia, public radio stations or PBS have created.
ElongatedTowel
I wondered how expensive their serves actually are. 1 month of reddit gold ($3.99) pays for ~276 server minutes at the moment, or so they say. That's about 0.0145 cent per minute. In a 30 day month there are 43200 minutes. Using these rounded numbers a month of hosting therefor would cost $626.4.

Though I highly doubt that figure is really that low (or doesn't include bandwith and similar, if applicable) I somewhat wish it was because that would be a sign of craftsmanship.

Unlike other similar companies who spend several hundred thousand dollars over two years just on hosting and go bankrupt, despite getting 1% of the traffic.

pmtarantino
$626.4 would be for one server. $626 x 276 servers would be $172800 per month.
joshmlewis
Thanks for clearing that up. I've been wondering what the total figure was.
zck
Units, people! If you have $626.4 / (server month), how do you get to $172,800 / month?

You need to multiply by servers. But what are our units on the 276 number you use?

$3.99 = 276 server minutes.

or 1 = $3.99 / (276 server minutes)

Dollars per server-month. Not servers. You can't multiply by 276 and get dollars per month.

pmtarantino
I misread, sorry. I thought $4 paid one minute for 276 servers.
rhgraysonii
I'm not 100% sure how I feel about it, but this is my first impression:

Reddit is a service that has truly created a community. And a community isn't just the good, it is the bad. For every bus driver being tormented that is saved with kickstarter story, you can find one where a user is being pestered and encouraged to commit suicide by trolls, or things like the Boston Marathon manhunt.

I feel as if the Reddit community is hitting a point of critical mass where one of two things are going to happen:

1. It becomes much more segmented, with specific subreddits disregarding interaction between users who generally stick to a few specific few, and these communities do well because they are now the size of what used to be entire large chunks of Reddit.

2. Reddit will fail to deliver enough new features fast enough to justify the spending, and it will result in many feeling slighted and we could see a digg-esque migration of users to some other service X that pops up.

Personally I have stopped using reddit as much as I used to, because I generally only peruse the programming and ruby/rails and clojure sections. Most of the stories I see posted are already on HN and have better discussion here. However, I am obviously a very specific case and the reddit userbase is quite widespread now that it has gotten so popular.

It really will be interesting to watch.

FreeKill
To be honest, your issue number one is basically how I think the site is supposed to work in the first place. It didn't take very long (even before the Digg influx) for the default subreddits to become just a sea of people where any discussions are both hard to have and difficult to read. However, the site gets infinitely better if you forego any of the default subreddits and you take the time to seek out all your areas of interest, and you cultivate a set of subreddits where the dialog matches your personal style and preferences. I think it's not a bad thing if the community segments, especially if a large portion of the overall community is not people you're interested in interacting with anyway...

I think Reddit has a huge longevity advantage over sites like the aforementioned Digg exactly because of the subreddits. You can consume as much or as little of the community as you want to and carve out an experience that suits your own tastes. With Digg, you either accepted the community as a whole, or you left...

byg80
I actually posted an article about this subject here a week or 2 ago called "The Rise and Inevitable fall of Reddit" located here:

https://medium.com/p/1e1fcdea99c4

That's if anyone's interested.

blakdawg
I paid for a year's worth of gold in advance and my account was banned with 10 months of service remaining. I can't get a response from anyone explaining what happened or how I can get a refund for the unused service. Never giving them $ again.

It's interesting to note that their "progress meter" never tells you what the goal actually is - it's perfectly possible that their goal is very low, or that the entire thing is faked to generate interest/the perception of progress.

AtTheLast
I like the idea. If the users are the one paying the bills then the site will focus making the best user experience to please users. If the site is advertiser driven, then the focus will slowly shift to making advertisers happy and increasing ad revenue. I think Jeff Bezos said something like this when he was talking about the newspaper industry.
alt_f4
I feel the idea is good, but they should actively pursue ways to cut server costs. For sites of their comparable size, they're wasting a lot of compute cycles.
tcrorg
As a redditor for more than two years, I think reddit gold is truly the most honest and sustainable way to make money off the site that is purely user-generated. We have seen how communities like Twitter and Facebook have responded to sites being taken over by ads. Also, as someone who has worked on social media advertising, they do not have as much returns as Adwords or other forms of PPC. Consequently, I see those advertising models die off as social media matures.

Reddit has intelligently put the onus of making money on the users. And letting people upvote people with gold, they have intelligently integrated the community feature with monetization which I feel is really sustainable.