It feels like they don't understand what it is about their own product that is valuable. Reddit ultimately is (or has been) a community hosting repository. The core interaction they need to be supporting, fostering, and ultimately monetizing, is community creation. The reason mods have been so reliant on third party apps was that reddit has neglected the tools necessary to curate communities, instead electing to focus their energy on a new user interface that reduced communities' ability to differentiate themselves, made the site generally less readable and functional, and also made it take much longer to load.

I even think there was a way to monetize the API that could have helped them run the site better by paying for infrastructure costs, or even pushing the site into profitability. But to do that, they needed an API price anyone was willing to pay. Reddit's decisions the past few years have been nearly aggressively tone deaf and short sighted.