The Federal Trade Commission (FTC) is currently investigating Reddit’s plan to allow artificial intelligence (AI) companies to utilize user-generated content for training their software. This inquiry, revealed in Reddit’s Securities and Exchange Commission (SEC) filing, has surfaced just days before the platform’s impending initial public offering.
Reddit stated that they received a letter from the FTC on Thursday regarding the investigation but mentioned that they were not taken aback by the inquiry. The FTC’s focus is on examining Reddit’s practices concerning the sale, licensing, or sharing of user-generated content with third parties for AI model training.
In response, Reddit emphasized that they do not believe they have engaged in any deceptive or unfair trade practices. The company acknowledged the FTC’s interest in this area due to the innovative technologies and unique commercial agreements involved.
A significant development was Reddit’s agreement in February to allow Google to use its data API to train AI models, a deal valued at $60 billion. The disclosure of the FTC probe was added as an amendment to Reddit’s IPO filing.
It is important to note that the current probe does not indicate a full-fledged investigation into Reddit’s operations. The social media company remains forthcoming about the situation and aims to cooperate with regulators during this process.
