User data has always been the core of freemium apps and “aggregators”: land-grab as many users as you can with a free, great product, so you can own a lot user data. We just didn’t have an obvious use for all that data until now.
Reddit won’t budge on the API pricing because they can make more selling datasets. But if they are smart, they’d rate limit free API access, and charge for the firehose — because then they’d have a user-generated content farm. But you still have the issue that people keep expecting their free apps to be free, not realizing they have been selling their data all along.
Remember FourSquare? They started as a neat way for people to socially compete in “checkins” for a place. They found their profit in selling that location data for business analytics and real estate analysis. The implications extend beyond commercial concerns when datasets like that are purchased by governments to circumvent wiretapping warrant requirements.
