News on Medial

Reddit says it's made $203M so far licensing its data

TechCrunch · 9m

Reddit's forthcoming IPO could be influenced by its relationships with AI vendors, such as OpenAI. In its recent IPO prospectus filing, Reddit highlighted the value it places on data licensing agreements with companies training AI models on its vast content repository. These agreements are expected to generate significant revenue, with a minimum of $66.4 million in 2024. The identity of the AI vendors has not been disclosed, but it has been speculated that Google may be involved in a licensing agreement worth approximately $60 million annually. OpenAI, led by Reddit's third-largest shareholder and former board member Sam Altman, could also be a potential customer. The value of Reddit's data lies in its ability to train and improve large language models, as well as its real-time access to a wide range of topics. Content producers are increasingly turning to data licensing agreements with AI vendors as they face competition from chatbots and the potential loss of website traffic.