I say this with all seriousness: This, and the API pricing fiasco (not the price change itself but the gratuitously insulting and dishonest way it was handled), and firing Victoria which still strikes me as a sad thing, and “fighting back” by removing moderators who were doing a “protest” instead of just shrugging and ignoring it all, and removing reddit coins even from the tiny fraction of people who were actually paying for them, are all totally nonsensical and self-defeating actions from a strict business perspective. Anyone who runs so much as a corner pizza shop and has to interact with the real world could see how counter to reddit’s interests they are. So, why did they do it?
I genuinely think that the motivation stems on an individual personal level from the psychology of “Well you’re disobeying me, so I’ll punish you.” The users are being disobedient on my platform? Fuck them, I’ll show them what I think of them, and unless they get in line, I’ll do it even worse. Your icon’s pixellated now. How do you like that?
I’m sure it works on a personal level, for some definition of “works.” On a corporate level though, I think the results so far pretty much speak for themselves.