Harm to the brand is hard to quantify. We can only assume they've done the calculus and decided freezing out 3rd party apps is worth the benefit. Knowing exactly what that benefit is, is conjecture. Best guess is that this is regarding the IPO which is expected in 2nd half of this year.

As a side note: the brand is clearly on their mind, as they've made exceptions for disability features. Banning Redreader would have caused quite a bit more uproar.