Reddit Considering Ending $60M/Year Data Licensing Deal with Google Over AI Concerns
Reddit is reportedly considering ending its data licensing agreement with Google, which pays the platform around $60 million annually. The deal allows Google to use Reddit's user-generated content for AI training and search results. However, Reddit may be willing to walk away from this revenue stream if it means preventing users from staying within Google’s ecosystem instead of visiting Reddit directly. The potential renegotiation comes as Reddit seeks greater control over how its data is used in AI products. The company's traffic could decline significantly if Google provides direct answers based on Reddit content without redirecting users to the platform, which would impact Reddit's advertising revenue. In response to recent reports about this dispute, Reddit’s stock fell 8.7%, marking one of its worst sessions since March. The deal is not a major source of income for Reddit—data licensing accounted for just $39 million in Q1 out of total revenues of $663 million—but it represents strategic value tied to user traffic and platform visibility.
Topics: AI data licensing Google Reddit traffic loss