"FTC Investigates Reddit's AI Data Practices Ahead of IPO"

The Federal Trade Commission (FTC) is conducting a non-public inquiry into Reddit's data-licensing practices related to training AI models ahead of its IPO, with the company disclosing a letter from the FTC in its updated prospectus. Reddit, which relies heavily on advertising, is also exploring data licensing as a revenue stream. The company's revenue rose 20% last year, with 98% from advertising and 2% from data licensing. Reddit has entered into data-licensing deals and expects to recognize at least $66.4 million from these agreements in 2024. The FTC's interest in Reddit's data-licensing business comes amid the company's plans to go public and expand its partnerships, including an expanded partnership with Google.