Reddit has signed an agreement “worth about $60 million on an annualized basis” to allow content from the site to be used to train an AI model, according to Bloomberg. The news was reportedly shared with investors earlier this year ahead of Reddit’s planned IPO.Bloomberg didn’t name the company with which Reddit is working. But it’s a “large AI company” and the agreement between the two could potentially be a model for future deals, suggesting Reddit might make similar deals with other AI companies.Reddit is expected to go public as soon as next month with a $5 billion valuation. The AI deal might potentially help bring over investors who are on the fence by proving that the site has an additional revenue stream in the works and potentially more in the future.Reddit made headlines last year when it started charging for access to its API, in part because large language models were scraping its content.AI-powered chatbots, such as ChatGPT made by OpenAI, have to be trained on human-made content in order for them to work. Early on, OpenAI used a number of nonfiction books as well as content from publications to train its bot, which landed the company in some legal trouble.
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OpenAI currently has agreements with a number of companies, including Business Insider and Politico, to train its bot using their content. CNN, Reuters, and the BBC have all blocked OpenAI’s web crawler from scraping their websites for content.In December, Apple reportedly approached publications including NBC News, Condé Nast, and IAC, and offered multi-year deals worth at least $50 million to allow their content to train its AI.
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