Reddit has confirmed that the Federal Trade Commission (FTC) has initiated an inquiry into the platform’s practices concerning the sale, licensing, or sharing of user-generated content with external entities for the purpose of training artificial intelligence (AI) models.
In a filing with the Securities and Exchange Commission on Friday, Reddit disclosed the inquiry, referencing a letter received from the FTC dated Thursday.
In response, Reddit stated, “Given the novel nature of these technologies and commercial arrangements, we are not surprised that the FTC has expressed interest in this area. We do not believe that we have engaged in any unfair or deceptive trade practice.”
Similar to other social media platforms, Reddit has shown interest in business agreements where AI companies pay for access to databases containing human-generated text. These databases assist AI models in enhancing their conversational abilities, answering queries, and generating written content and images upon request.
Recently, Reddit announced a $60 million deal with Google, facilitating access to human-generated text for AI training. This partnership also grants Reddit access to Google’s AI models to enhance internal site search and other functionalities. Reddit has chosen not to provide further comments or answer questions regarding the agreement.
This disclosure coincides with Reddit’s plans to conduct its initial public offering (IPO), marking its first public offering of shares. The San Francisco-based company filed IPO paperwork on Monday, estimating a valuation of up to $6.4 billion for the 18-year-old platform.
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