Feb 24: Google and popular social media platform Reddit have reportedly signed a deal to allow Google access to Reddit’s content for the purpose of training its artificial intelligence models. According to three sources familiar with the matter, the contract between Google, which is owned by Alphabet, and Reddit is valued at approximately $60 million per year.
The deal demonstrates how Reddit, which is on way for a high-profile stock market launch, is seeking to generate new revenue amid fierce competition for advertising dollars from the likes of TikTok and Meta Platform’s Facebook.
In an exclusive report, undisclosed sources with knowledge of the matter, who were not authorized to speak to the media and chose to remain anonymous, revealed that the social media firm and Google have refrained from providing comments on their recent collaboration. The agreement, previously mentioned by Bloomberg without disclosing the buyer’s identity, signifies the social media platform’s first known partnership with a major artificial intelligence (AI) company.
Reddit getting ready for an IPO
Last year, Reddit announced plans to monetize its application programming interface (API) by charging companies for content access. This strategic move aligns with Reddit’s upcoming initial public offering (IPO) filing, anticipated to be submitted this week from its San Francisco headquarters. The IPO filing, expected as early as Thursday according to insider sources, will unveil the social media platform’s financial details to potential investors for the first time.
With a valuation of approximately $10 billion following a 2021 funding round, the social media platform aims to offer around 10 percent of its shares in the IPO, as reported by Reuters. If successful, Reddit’s IPO would mark the first major stock market debut of a social media company since Pinterest went public in 2019.
Amidst a trend where AI model developers are actively securing content partnerships to enhance their training datasets beyond web scraping, concerns over potential copyright violations have surfaced. Notably founded in 2005 by Steve Huffman and Alexis Ohanian, the social media platform has gained prominence for its diverse array of specialized discussion communities, some boasting memberships in the tens of millions.
