Reddit co-founder and CEO has hinted that paywalls for certain subreddits could be on the way, in latest monetisation move
The CEO of social media platform Reddit has hinted at a potential monetisation move that could justify existing concerns of some Reddit users and moderators.
Engadget reported that Reddit CEO Steve Huffman had suggested during the company’s Tuesday earnings call, that the platform could achieve another monetisation avenue by moving some subreddits behind paywalls.
Also during the earnings call, the Reddit co-founder said the company would begin testing AI-powered search results later this year.
Future paywalls?
“Later this year, we will begin testing new search result pages powered by AI to summarise and recommend content, helping users dive deeper into products, shows, games and discover new communities on Reddit,” Huffman was quoted by Engadget as saying.
In May Reddit had signed a content agreement with OpenAI to give it access to all the user posts on the Reddit platform. The firm has also signed a similar AI deal with Google.
On the earnings call this week Huffman also reportedly noted that search on Reddit has “gone unchanged for a long time” but that it’s a significant opportunity to bring in new users. He also reportedly said that search could one day be a significant source of advertising revenue for the company.
And Huffman hinted at other non-advertising sources of revenue as well.
According to Engadget, Huffman suggested that the company might experiment with paywalled subreddits as it looks to monetise new features.
“I think the existing, altruistic, free version of Reddit will continue to exist and grow and thrive just the way it has,” Huffman reportedly said. “But now we will unlock the door for new use cases, new types of subreddits that can be built that may have exclusive content or private areas, things of that nature.”
Moderator, user concerns
The hinting of possible paywalls in the future, will do little to allay existing concerns of Reddit users and moderators.
The company was founded in 2005, nearly 20 years ago, and prior to its IPO in March, had never made a profit and lost more than $90 million (£71m) in 2023.
Advertising accounted for nearly all the revenue, but Huffman has made no secret of his intention to explore opportunities in e-commerce and licensing content to AI companies.
Reddit’s forums are moderated by unpaid volunteers, not employees, and some moderators are sceptical of any monetisation plans, with one previously noting in a private chat room for mods that they would effectively be paying for content they themselves had generated.
Prior to its successful initial public offering in March 2024, some prominent contributors had reacted with pessimism to a regulatory filing detailing future monetisation plans, with one calling it the “beginning of the end”.
API access
Reddit moderators do have a history of conflict with the company’s management.
This includes shutting down high-profile discussions in 2023 in protest against a company decision to begin charging developers for access to the Reddit API.
The company did not back down on its decision, however, as it continues to seek new ways to generate revenue opportunities.
