Reddit Lays Out Content Policy While Seeking More Licensing Deals

Aisha Counts, Bloomberg News

Reddit Inc. signage is displayed on a smartphone in an arranged photograph taken in the Brooklyn borough of New York, U.S., on Tuesday, June 30, 2020. Twitch and Reddit Inc. banned content linked to President Donald Trump for violating their rules against encouraging hate. Photographer: Gabby Jones/Bloomberg , Bloomberg

(Bloomberg) -- Reddit Inc. released new policies governing data posted on its social network, including a ban on sending advertisements to users without consent, as it seeks to increase revenue through licensing agreements with artificial intelligence developers and other companies.

The site’s content policy prevents data licensees from using Reddit posts or comments that have been deleted, making that content available to law enforcement agencies or using posts in a way that violates intellectual property rights, among other restrictions.

Chief Legal Officer Ben Lee said it was important to set out the guidelines, in part, because there was a perception that companies licensing Reddit’s data could do anything they wanted with the material.

The social media company has a licensing agreement with Alphabet Inc.’s Google worth $60 million to help train large language models, the technology underpinning generative AI, and is in talks with other AI companies.

“They can’t try to reverse-engineer our user’s identity,” co-founder and Chief Executive Officer Steve Huffman said, referring to companies that pay to use Reddit data. “You can’t use it target ads. You can’t build a Reddit competitor, for example.”

Huffman, speaking at a press briefing, also said Reddit would not share any private data, such as private messages, email addresses or phone numbers with data licensees, including AI companies. The company said it had more than 82.7 million global daily users in the first quarter — a 37% jump from a year earlier.

Still, Reddit reminded users that it’s “inherently” a public platform. “Most of Reddit’s platform is public and accessible to everyone, even without an account,” the company said in its content policy. Users had posted 1 billion times and offered 16 billion comments on the platform as of the end of 2023, Reddit reported in filings.

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Huffman said Google has been a good partner, but that other companies have “taken advantage of” Reddit by scraping the site’s data without authorization to train AI models or using the platform’s content without sending any users back to the site.

“We’re not against using Reddit data to train AIs,” said Huffman. “We just want to do so on clear terms so that everybody knows what’s going on.”

Earlier this year, the Federal Trade Commission began investigating Reddit’s plans to license its user-generated content. Huffman said the conversations are in the early stages and declined to share more. The company previously said in a filing that it didn’t believe it had engaged in unfair or deceptive practices.

Reddit’s AI licensing business is small but growing. Huffman declined to discuss the specifics of the Google deal but said typical terms can range from how long of a Reddit summary can show up in a Google search to whether a licensee has to display Reddit branding in AI-generated results.

Reddit has signed licensing agreements worth $203 million in total, with terms ranging from two to three years. The company generated about $20 million from AI content deals last quarter, and expects to bring in more than $60 million by the end of the year.

(Updates with number of posts in the seventh paragraph.)