Reddit is undergoing a significant transformation. The Wall Street Journal has sighted an email from CEO Steve Huffman indicating that Reddit plans to terminate approximately 90 of its employees, which equates to around 5% of the current workforce of 2,000.
Furthermore, Reddit has adjusted its hiring strategy this year, reducing the number of new employees from its previously planned 300 to just 100. It appears that the popular online platform is focusing on reaching its primary objectives, one of which is to achieve financial balance by next year. In the email, Huffman reportedly stated that Reddit experienced a “solid first half of the year,” and he believes this organizational change will propel that success “into the second half and beyond.”
Reddit’s workforce reduction is just one in a series of steps towards increasing revenues. In April, the company stated it would begin charging developers for API access. This decision was made in the midst of the surge in generative AI technology, which typically utilizes data obtained from the internet via APIs. Reddit expressed that, as a platform hosting one of the largest compilations of human dialogues online for the past 18 years, they have a duty to responsibly manage this content.
While Reddit’s intention may have been to generate income from larger corporations, the move has also impacted individual developers. For instance, Christian Selig, the sole developer of Apollo for Reddit, claimed it would require $20 million annually to maintain his app as it is. Other third-party apps, such as Narwhal and Reddit is Fun, have preemptively alerted users that they cannot afford Reddit’s API costs and may need to discontinue their services. As a protest, dozens of subreddit communities covering a wide range of topics plan to go offline starting from June 12th. While some plan to stay offline for 48 hours, others plan to remain inaccessible until Reddit addresses their concerns.
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Frequently Asked Questions (FAQs) about Reddit Workforce Reduction
What changes is Reddit reportedly making?
Reddit is said to be undergoing a significant transformation, which includes laying off around 5% of its workforce or about 90 employees. It’s also slowing down its hiring, reducing the intake from the originally planned 300 new employees to just 100.
Why is Reddit laying off a portion of its workforce?
The company is restructuring in an effort to focus on achieving its major goals, including breaking even financially by next year. The workforce reduction is part of a series of steps aimed at increasing the company’s revenues.
How is Reddit affecting developers with its new policy?
Reddit announced it would start charging developers for access to its API. This decision has been impactful not just for big companies but also for independent developers. Some developers, like Christian Selig, the developer of Apollo for Reddit, have reported substantial costs that they can’t bear, which may lead to discontinuation of services.
What are subreddit communities planning in response to Reddit’s decisions?
In response to Reddit’s decisions, dozens of subreddit communities are planning to go offline starting from June 12th in protest. While some plan to remain inactive for 48 hours, others intend to stay dark permanently until Reddit addresses their concerns.
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