I feel like ad revenue is not their top monetization priority personally. It's speculation of course. But I think they are learning that the free content the users create will generate much more revenue from mega corps who want access to all of it to train emerging AIs. Data, specifically YOUR data is valuable. What posts do you look at? What do you upvote? What do you downvote? What subreddits do you subscribe to? There is a wealth of information they will monetize. This is why I think they don't care that the little app devs can't afford their new API pricing. They can't give the app devs one price then think Microsoft, Google, Apple and other multi-billion dollar corps would pay a higher price.

Again, this is just my speculation. But the suddenness and the exorbitant price means they want to act now, and capitalize on this new market while it's good. Their terms of service specifically say everything you post, you give them a license to use, sell, or sub-license without dispute, forever. This isn't about ads.

This is absolutely true. There are often calls for 'anyone want to mod' on even smaller subs... and you know, it sounds fun to a lot of folks at first. But if you've ever actualy been a mod, even of a smaller community online? It loses its appeal very quickly.