Reddit faces FTC inquiry over the sale of user data to AI companies

The Federal Trade Commission (FTC) inquired Reddit about the sale, licensing, or sharing of user data with AI companies. On March 15, the company disclosed the news in its filing with the Security and Exchange Commission. 

Talking about the FTC inquiry in its recent filing, Reddit wrote:

Given the novel nature of these technologies and commercial arrangements, we are not surprised that the FTC has expressed interest in this area. We do not believe that we have engaged in any unfair or deceptive trade practice.

Reddit mentioned as a part of the FTC inquiry, officers questioned their plans and asked for various information and related documents. The company also included that the inquiry is ongoing.

It is worth noting that Reddit has recently been showing interest in several business deals with AI companies. It plans to allow third parties to access databases of human-written text that AI models can train upon.

Let’s not forget that Reddit struck a $60 million deal with Google last month for a similar purpose. This deal allows Google’s AI models to train on Reddit users’ content that aims at improving internal search and other features.

The latest filing also revealed some less-known details about the San Francisco-based company. For example, OpenAI’s Sam Altman is one of the top investors who owns about 9 percent of the company’s stake.