Reddit has officially partnered with OpenAI to integrate platform content into ChatGPT, diversifying its revenue streams.
Building on a recent deal with Google reportedly worth $60 million annually, OpenAI will access Reddit’s Data API to provide real-time content for ChatGPT.
In exchange, Reddit will introduce AI features powered by OpenAI and the latter becomes an advertising partner on the platform.
Sam Altman, OpenAI CEO and major Reddit shareholder, saw his share value soar to $750 million post-deal.
Reddit’s stock rose over 10% as it aims to reduce reliance on advertising income.
Founded in June 2005 by Steve Huffman and Alexis Ohanian, Reddit combines social media, message boards, and news aggregation, with Huffman currently serving as CEO.
Reddit and OpenAI announced a partnership to benefit their communities. https://t.co/qah9TaRjVU
— Reddit (@Reddit) May 16, 2024
Reddit Advances Toward Profit
Huffman stated, “(connecting Reddit to) ChatGPT upholds our belief in a connected internet, helps people find more of what they’re looking for, and helps new audiences find community on Reddit.”
Reddit’s community expressed concerns about Big Tech using its data, but the partnership with OpenAI promises mutual benefits and user-facing changes.
Investors showed confidence in Reddit’s data-trading strategy, driving demand during its IPO on the NYSE in March.
Last year, Reddit reported a net loss of $91 million, despite never turning a profit since its inception.
Image credit: Ideogram
Leave a Comment