this post was submitted on 28 Feb 2024
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There has never been a profitable social media company.
Facebook might have started out as a social media company, but it's only profitable now because it's part of an advertising duopoly that has almost all online ads completely locked up. Their actual business is renting eyeballs to advertisers. The social media part of it is just data collection for their advertising.
Reddit can't compete with the big 2 as an ad platform. They don't have the reach of the other two, and never will. So, it's not going to be a good money making platform, but it might be able to have a niche and cover its costs. There are ways it could do that and not be awful for users.
They could partner with Hollywood studios to promote shows and movies, provide forums to discuss them that are safe for those brands. They could work with local governments to be a place to release important information. Governments used to do that on Twitter, but Twitter has gone to shit. This isn't stuff that will send Reddit shares to the moon like their VC backers want. But, it could survive.
Instead, they're going to follow the Elon Musk playbook and it will die.
AMA used to be a pretty big draw for lots of people who didn't regularly use the site and often made international news, but they fucked that right up.
Yeah. You could see they were coordinating with the agents of celebrities. The celebs found it more interesting than the generic interviews they did with other media outlets. Upvoting and downvoting meant the best questions bubbled up to the top, although sometimes they were things the celebs didn't want to talk about. But, with a good PR person in the room they did fine with it.
There's a niche there, but it isn't going to be a humongous one that will make Reddit a trillion dollar business.
Yep. Everyone thinks they are entitled to be Zuckerberg. Only one entitled person got away with it and he even stole the damned thing.
And, he only got away with it until he was able to pivot to advertising. Sure, small social media companies (even relatively large ones like Twitter) also want to sell ads, but the more user data you have, the more you can convince people that your ads are nearly mind control. Meta can do that because they control Facebook, Instagram, WhatsApp, etc. They got all the users because the users were hooked before they started selling the ads, and now network effects mean they don't want to leave.
All of that sucks in user data which they can then sell ads against. Reddit would just be one text-based ad site where people use pseudonyms. It's never going to be able to compete with Meta for ad dollars.