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What is Reddit's New IPO Plans with Google? Popular Social Media Platform Signs USD 60 Million Deal With Tech Giant to Train AI Models on its Posts
Reddit and Google have reached a deal that permits the search engine company to train its artificial intelligence models using posts from the social media platform.
On February 22, Reddit announced that it had signed a $60 million deal with Google, which would let the internet giant use posts from the discussion board to train its artificial intelligence (AI) algorithms and improve services like Google Search. Additionally, Reddit will have access to Google AI models to enhance other functions like its internal site search.
Reddit's deal with Google
Reddit, which is governed by volunteer moderators to oversee its vast assortment of rambling topic-based debates, is taking a significant step forward with the Google deal.
The San Francisco-based company announced plans for its initial public offering (IPO) in a different statement. The company intends to list RDDT as its ticker on the New York Stock Exchange for its shares.
On February 21, it also revealed a net income of $18.5 million for the October–December quarter, which represented its first profit in the previous two years. During the same time frame, Reddit brought in $249.8 million. The US SEC received a file including these figures.
Google adheres to Reddit's policies
By signing this agreement, Google agrees to abide by Reddit's privacy and user conditions. Unlike other social media sites, Reddit takes a unique stance when it comes to user content removal. Reddit users completely remove all of their posts when they delete them, leaving no trace. Reddit partners such as Google are also bound by this policy, which demands that they honor the decisions made by users on the platform.
These moderators have openly disagreed with past Reddit policies, most notably when Reddit declared that it would begin charging numerous third-party apps for access to its content, causing a major blackout of the website for several days. Also, individuals actively seek their favorite discussion threads on Reddit, in contrast to other social media platforms where user interests are predicted by automated algorithms.
Reddit's connection to Sam Altman's Open AI
According to the regulatory filing outlining OpenAI's ambitions for an IPO, Reddit now counts Sam Altman, the CEO of the company, as a significant shareholder, Bloomberg reported. According to the S-1 filing that was made public on February 22, entities associated with Altman own 8.7 percent of Reddit's outstanding shares.
Furthermore, with almost one-third of the voting power, the Newhouse family publishing empire's Advance Magazine Publishers Inc. owns the bulk of Reddit's shares.
As a member of the first class at the Y Combinator accelerator in 2005, Altman has a strong relationship with the San Francisco-based social media company, having joined Reddit co-founders Steve Huffman and Alexis Ohanian. In addition, Altman took on a temporary role as the company's acting CEO for eight days after Yishan Wong, the previous CEO, resigned.
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