Reddit announces Google partnership and a Directed Share Program

Both companies have come forward after Bloomberg broke the news that Reddit had landed a $60 million annualized contract with an "unnamed large AI company" on February 21. Shortly afterward, Reuters picked up the news and obtained confirmation that the unnamed company was Alphabet-owned Google, and remarked that this was the first substantial deal that Reddit had struck after announcing significant changes to its Data API last year. News of the agreement broke just as Reddit prepared to make an initial public offering seeking a valuation of at least $5 billion, which the company filed just a day later.

In the jointly published announcements, Google states Reddit will now be able to leverage Vertex AI to implement AI capabilities into its platform that will enhance the Reddit search and overall experience. Google also nodded to the impact that the Reddit blackouts following the announcement that Reddit would be charging for API access had on its overall search experience by recognizing that people find Reddit content valuable. Google also referenced the announcement that it was experimenting with a 'Perspectives' filter that restricts search results to short and long-form human-generated content posted in forums and social media, such as reviews, tutorials, and recommendations. Finally, the company acknowledged that access to Reddit's Data API would be the catalyst that enabled Google to better display, understand, and train on Reddit content.

Reddit also emphasized improving the Reddit experience is the principal goal of the partnership. This will mainly be accomplished by making the communities and conversations that are most relevant to users easier to find on Google and Reddit. The company also clarified that its partnership with Google will not impact the Data API or Developer terms, which currently state that the API cannot be used for commercial purposes without Reddit's authorization. Most importantly, the Data API remains free to use for non-commercial purposes. On a related note, Reddit has also launched a Directed Share Program following its IPO filing. The program is explained in a FAQ page that details how eligible moderators and users can get their hands on a piece of Reddit and "become one of [Reddit's] (non-corporate) overlords."

The new partnership between Reddit and Google is an illuminating example of how most AI incumbents scramble to get their hands on high-quality, human-created content even as some alternatives to this kind of data emerge. A promising alternative for AI companies lacking the resources of a tech giant is federated and decentralized AI because it does not require collecting and hosting massive amounts of data in the cloud. Flower Labs recently completed a $20M funding round to accelerate mainstream adoption of this alternative strategy for training large language models.