1. OpenAI has reached a deal with Reddit to use the social news site’s data for training AI models and will incorporate Reddit content into ChatGPT for new features.
2. OpenAI CEO, Sam Altman, has an 8.7% stake in Reddit, making him the third-largest shareholder, but assures that the partnership was led by OpenAI’s COO and approved by the independent board of directors.
3. Reddit has made data licensing agreements a central part of its growth strategy, seeing a 450% year-over-year increase in non-ad revenue from agreements with companies like Google and Reddit stock rose 11% following the announcement of the OpenAI deal.
OpenAI has partnered with Reddit to use the social news site’s data for training AI models, allowing for better understanding and showcasing of content. The partnership will bring new AI-powered features to both Reddit users and moderators, with OpenAI also becoming a Reddit advertising partner. Reddit has been increasingly focusing on data licensing agreements as part of its growth strategy as a public company, with agreements worth over $200 million with customers like Google.
Reddit’s vast platform with billions of posts and comments is attractive to generative AI companies for training models. However, there may be pushback from users concerned about data monetization. Similar concerns arose with Stack Overflow’s agreement with OpenAI, resulting in user protest and eventual banning. Reddit has already taken action against a startup, Vana, attempting to give users more control over their data through a blockchain-based data DAO.
Despite the potential for controversy, Reddit stock rose following the announcement of the partnership with OpenAI. The integration of AI into the platform could improve user experience, but heightened focus on data usage and privacy may result in further challenges for the company.