Reddit reportedly signed a $60 million cope with a “massive AI firm” to permit its on-line communities to be scraped for AI training data, in response to Bloomberg on Friday. The unnamed AI firm will sift by means of hundreds of thousands of posts on Reddit, and practice a big language mannequin on Reddit’s threads.
Reddit is reportedly weighing an IPO with a $5 billion valuation, regardless of solely bringing in $800 million in income final yr. Reddit will not be worthwhile however has a wealthy valuation as a result of its on-line communities supply an ideal coaching floor for AI fashions. Nevertheless, licensing out your consumer base’s ideas and concepts will not be at all times reciprocated nicely. The most popular subreddits went dark in protest last year after customers took challenge with the corporate charging for access to its application programming interface (API), first introduced in April of 2023.
Reddit’s reported cope with an “unnamed massive AI firm” is precisely what the platform has been in search of. Massive Tech is hungry for information, and that has turned legacy information organizations, neighborhood boards, and even the University of Michigan into mere content material farms. These offers, although upsetting to customers, supply Reddit a path to profitability.
“The Reddit corpus of information is de facto worthwhile,” mentioned Reddit CEO Steve Huffman to The New York Times in April. “However we don’t want to provide all of that worth to among the largest corporations on the planet free of charge.”
However when Reddit began charging for API entry, it didn’t simply cost massive corporations, it additionally began charging small, unbiased researchers. This shift made it harder for Reddit’s moderators to handle their communities, and a few argued it made for a worse expertise for Reddit’s 800 million monthly active users.
“We imagine that the longevity and success of this platform relaxation on preserving the wealthy ecosystem that has developed round it,” mentioned Reddit moderators in a collective letter from final June. “The potential lack of these companies because of the pricing change would considerably influence our capacity to reasonable effectively, thus negatively affecting the expertise for customers in our communities.”
Reddit didn’t instantly reply to Gizmodo’s request for remark.
Apple was exploring $50 million AI deals with The New York Occasions, Condé Nast, and different information publishers in December. Shutterstock can be licensing its human-made content to OpenAI for coaching on its fashions. Twitter, Instagram, and YouTube have additionally turn into more and more worthwhile in recent times, as they’re now seen as content material gold mines.
The platform additionally launched advertisements in recent times and made it impossible for users to opt out of seeing advertiser content in 2023. As Reddit turns into a public firm, there’s a rising concern from customers that administration will damage the thriving neighborhood discussion board it has constructed.
There’s additionally a much bigger concern about how AI corporations are licensing information. Content material platforms are signing million-dollar licensing agreements with AI corporations, however the precise individuals who created this content material aren’t getting a factor. In the meantime, AI threatens to replace content creators within the editorial, graphic design, and movie industries.
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