The US FTC has launched a private investigation into Reddit's sharing of user-generated content with AI companies

according to Reddit Securities documents revealed that the US Federal Trade Commission (FTC) is investigating the social platform for licensing content to AI companies.Closed investigationAccording to foreign media Axios, other companies have also received investigation letters from the FTC.

Reddit applied last month IPO, raising up to US$748 million at a price of US$3.1 to US$3.4 billion per share, with a total valuation of nearly US$6.5 billion (currently approximately RMB 46.8 billion).

The US FTC has launched a private investigation into Reddit's sharing of user-generated content with AI companies

Image source: Pexels

The social platform stated,The FTC's investigation focuses on Reddit's practice of selling, licensing, and sharing user-generated content to third parties as AI training material.The FTC will ask the social platform to provide more information and documents in the future to better understand the transaction.

According to foreign media reports, Reddit has reached an AI training data licensing agreement with Google, which will generate US$60 million (currently approximately RMB 432 million) in revenue each year.

In Reddit’s view, it’s natural for the FTC to focus on this new type of transaction;Reddit doesn't think its actions violated U.S. consumer protection laws.

Reddit's revenue last year reached $800 million, 98% of which came from advertising. It is working hard to expand its revenue channels, and in addition to selling AI training materials, it has also begun charging for APIs.

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