Reddit mentioned forward of its IPO next week that licensing consumer posts to Google and others for AI initiatives may usher in $203 million of income over the subsequent few years. The community-driven platform was compelled to reveal Friday that US regulators have already got questions on that new line of enterprise.
In a regulatory filing, Reddit mentioned that it acquired a letter from the US Federal Commerce Commision on Thursday asking about “our sale, licensing, or sharing of user-generated content material with third events to coach AI fashions.”
The FTC, the US authorities’s major antitrust regulator, has the ability to sanction corporations discovered to interact in unfair or misleading commerce practices. The thought of licensing user-generated content material for AI initiatives has drawn questions from lawmakers and rights groups about privacy dangers, fairness, and copyright.
Reddit isn’t alone in attempting to make a buck off licensing knowledge, together with that generated by customers, for AI. Programming Q&A website Stack Overflow has signed a deal with Google, the Associated Press has signed one with OpenAI, and Tumblr proprietor Automattic has said it’s working “with choose AI corporations” however will permit customers to opt-out of their knowledge being handed alongside. Not one of the licensors instantly responded to requests for remark. Reddit additionally isn’t the one firm receiving an FTC letter about knowledge licensing, Axios reported on Friday, citing an unnamed former company official.
It’s unclear whether or not the letter to Reddit is straight associated to evaluate into every other corporations.
Reddit mentioned in Friday’s disclosure that it doesn’t imagine that it engaged in any unfair or misleading practices however warned that coping with any authorities inquiry will be expensive and time-consuming. “The letter indicated that the FTC workers was focused on assembly with us to be taught extra about our plans and that the FTC supposed to request data and paperwork from us as its inquiry continues,” the submitting says. Reddit mentioned the FTC letter described the scrutiny as associated to “a private inquiry.”
Reddit, whose 17 billion posts and feedback are seen by AI consultants as invaluable for coaching chatbots within the artwork of dialog, announced a deal last month to license the content material to Google. Reddit and Google didn’t instantly reply to requests for remark. The FTC declined to remark.
AI chatbots like OpenAI’s ChatGPT and Google’s Gemini are seen as a aggressive risk to Reddit, publishers, and different ad-supported, content-driven companies. Previously yr the prospect of licensing knowledge to AI builders emerged as a possible upside of generative AI for some corporations.
However using knowledge harvested on-line to coach AI fashions has raised quite a lot of questions winding via boardrooms, courtrooms, and Congress. For Reddit and others whose knowledge is generated by customers, these questions embrace who really owns the content material and whether or not it’s honest to license it out with out giving the creator a reduce. Safety researchers have discovered that AI fashions can leak private knowledge included within the materials used to create them. And a few critics have prompt the offers may make highly effective corporations much more dominant.
