Reddit Considers Ending AI Content Licensing Deal with Google
Reddit is reportedly considering not renewing its $60 million-per-year licensing agreement that allows Alphabet's Google to train its AI models using Reddit’s content. The move comes as the company weighs potential long-term risks, including reduced traffic if users increasingly rely on chatbots for answers instead of visiting Reddit forums directly. The current deal accounts for a small portion—less than 2%—of Reddit’s total revenue over the past four quarters. While Google Search still drives significant traffic to Reddit, that trend is declining as AI tools like ChatGPT and Gemini become more popular. Analysts suggest that while the decision could be bold, it may also protect Reddit's brand value by preserving its role in offering nuanced discussions rather than being reduced to a data source for chatbots. Reddit’s stock has declined over 20% this year but remains strong with high gross margins and significant ad revenue growth. The company is evaluating whether the deal aligns with long-term business goals, though analysts believe it's too early to worry about its future.
Topics: AI content licensing Google Reddit