• Reddit will sell vast swathes of user data to Google, which will use the data to train its AI models.
• Google will pay Reddit $90 million a year for the data.
• This comes amid Reddit looking to go public and start making money from its user base of 70 million daily visitors.

Information from the more than 70 million people that use social media platform Reddit every day will now be sent to tech giant Google in order to train its generative AI models. This new deal will see Google pay Reddit $60 million per year to source user data from the platform.

According to a report from Reuters, the deal comes amid plans from Reddit to go public, which could be as soon as this week. The company is desperately seeking ways to make money from its user-base, which includes ideas such as charging for the use of its API – the process in which the platform distributes content. Google is the first company to bite at the offer.

“The Reddit corpus of data is really valuable. More than any other place on the internet, Reddit is a home for authentic conversation,” Reddit CEO Steve Huffman told The New York Times in April last year.

Companies like Google and OpenAI train their large language AI models using data collected from people on the internet, but this process of scraping the internet at random leads to a massive collection of chaotic information. Having access to Reddit’s data will give Google’s AI a more precise source to draw its information from.

“But we don’t need to give all of that value to some of the largest companies in the world for free,” Huffman added at the time.

Anonymous Reddit insiders who spoke to Reuters said that the company could go public as early as Thursday. Before doing this it would have to make its financials public, allowing potential investors to see how much money it has made on advertising since launching in 2005. The company was valued at $10 billion as of 2021.

Unlike other social media platforms, Reddit is unique for the willingness of its users to share information and have conversations. As Huffman put it “There’s a lot of stuff on the site that you’d only ever say in therapy, or AA, or never at all.”

This provides an opportunity for Google to create AI models that provide more unique results as compared to rivals like Microsoft Copilot and ChatGPT. Google itself is playing a game of catch up having arrived at the AI party late. Even CEO Sundar Pichai admitted as much last year.

It quickly spun up Google Bard, its first AI chatbot, before replacing the platform with Google Gemini, for which it is now offering a subscription service to users in order to unlock smarter AI and more features. Despite the rapid progress Google has made in the sector – expected to add $15.7 trillion to the worldwide economy by 2030 – it is still lagging behind its major competitors in terms of users and AI capabilities.

The Reddit deal provides a much-needed advantage for the Alphabet-owned mega-corporation.

[Image – Photo by Brett Jordan on Unsplash]