Reddit shares increased after the OpenAI data deal, enabling OpenAI’s tools to comprehend better and exhibit its contents.
In after-hours trading, Reddit (RDDT) increased 11% after the social media company reached a data-sharing agreement with OpenAI, the artificial intelligence chatbot ChatGPT developer.
Reddit announced on May 16 that it will grant OpenAI access to its Data API, which provides real-time content derived from platform posts. The company said this partnership would “bring Reddit content to ChatGPT and new products.”
OpenAI shall furnish Reddit users and moderators with novel artificial intelligence-driven functionalities to enhance user engagement.
The AI company was also selected as Reddit’s most recent advertising partner.
Reddit declined 5.45% on May 16, but according to Google Finance, the partnership announcement after the bell caused it to increase by 11.05% to $62.61 in after-hours trading.
Reportedly worth $60 million, Reddit and Google entered into a comparable agreement in February.
Reddit has maintained an enduring commitment to enhancing community engagement and generating revenue through means other than advertising space.
As legal action mounts against OpenAI and other AI companies for the data-gathering methods they use to train their models, the agreement is reached amid allegations that the companies unlawfully appropriated copyrighted material and private data.
Sony, the largest music publisher in the world, reportedly informed over 700 companies, including AI developers OpenAI, Microsoft, and Google, in letters dated May 16 that it has “reason to believe” they have “unauthorized uses” of its music to train their models.
Community Points, an earlier blockchain-based rewards service, was discontinued by the company in October last year because of scalability concerns.
Reddit disclosed that it maintained cash reserves of Bitcoin BTC (-$66,229) and Ether ETH (-$3,026) in February. Furthermore, it enables users to make payments for specific virtual items using Ether and Polygon MATIC (-$0.7083).
