According to sources familiar with the matter, Reddit has reached an agreement with Google to provide its content for the training of the tech giant’s artificial intelligence models.
The deal, valued at approximately $60 million per year, highlights Reddit’s efforts to generate additional revenue as it prepares for a highly anticipated stock market debut. This move comes amidst stiff competition for advertising revenue from platforms like TikTok and Meta Platform’s Facebook.
The sources, who spoke on condition of anonymity as they were not authorized to discuss the matter publicly, revealed that neither Reddit nor Google provided comments on the agreement.
Previously, Bloomberg had reported on Reddit’s content deal without disclosing the identity of the buyer. This marks Reddit’s first reported deal with a major AI company, following its announcement last year that it would charge companies for access to its application programming interface (API).
Based in San Francisco, Reddit has been contemplating an initial public offering (IPO) for over three years and is expected to file for IPO this week, offering potential investors a glimpse into its financials for the first time.
The company, valued at approximately $10 billion following a 2021 funding round, aims to sell about 10% of its shares in the offering, as reported by Reuters.
If successful, Reddit’s IPO would be the first major social media company to go public since Pinterest in 2019.
Recent months have seen a flurry of deals between AI model developers and content providers, as they seek to broaden their training datasets beyond publicly available internet sources. However, this practice has sparked concerns about potential copyright violations, with many content creators claiming unauthorized usage of their content.
