The FTC is probing Reddit’s AI licensing deals

The Federal Trade Commission is investigating Reddit’s AI licensing agreements In filings with the Securities and Exchange Commission. The company, which is in the midst of an Initial Public Offering, said the regulator informed Reddit officials that it “intends to request information and documents” about the company’s AI deals.

It’s unclear why the FTC is investigating Reddit’s relatively new licensing case, but its inquiry appears to be in the early stages. “On March 14, 2024, we received a letter from the FTC stating that FTC staff is conducting a non-public investigation into the sale, licensing, or sharing of user-generated content with third parties to train artificial intelligence models,” Reddit wrote in a filing. “Given the novel nature of these technologies and commercial arrangements, we are not surprised that the FTC is interested in this area. We do not believe we are engaged in any unfair or deceptive trade practices.”

Reddit’s agreements to license its directory of user-generated content are a key part of the company’s strategy to increase revenue. . On the day the company filed for its IPO, the company announced a deal with Google that will use Reddit data to train AI models. This arrangement is said to be valuable . The company said it is in the early stages of “exploring” such deals.

According to , other companies have received similar letters from the FTC. The regulator has previously taken an interest in the current wave of generative artificial intelligence and their ties to big tech companies, the FTC now Microsoft, Alphabet and Amazon on their investments in prominent AI startups.

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