It's fine now when there aren't nearly as many users, but I don't see it scaling long term unless hashtags are a thing or something like that. Even something simple like gaming, over on reddit I'm in several very active subs - pcgaming, playstation, playstation4, several zelda subs, etc. If fediverse alternatives get to even 1/4 of the userbase that reddit has, the gaming (or whatever) portion is going to be such a firehose it won't really be usable. And IIRC this is how it played out on reddit as well. I think (though could be mistaken) reddit started with a fairly small set of subs and it wasn't until later that you could create your own subs.
I think this whole thread/post is over-thinking it. If all reddit wanted was to break-even or make some profit off of the api, they wouldn't have priced it this way. They would have had changed the api to a key system and then created a two tier pricing system: third party apps like RIF and Apollo, and a large commercial license for LLM training and such.
This is fuck you pricing. As in, if you don't want to take a job, you tell them the price is 8x your normal hourly rate. You either get that bag or more likely, they don't offer the job. Although I say this with less certainty than I would have a month ago seeing exactly how stupid reddit is about all of this, I can't believe that anyone at reddit is so out of touch they actually thought any of the third party app devs could afford this pricing, and if they did and it wasn't just to kill apps, they would changed the pricing structure and not triple/quadrupled down.
This is just Huffman going after the IPO so he can get his golden parachute and peace out. I would absolutely put money on him being out less than a year after IPO, with the small asterisk that as bad as he's fumbling right now the board might kick him before that.