Reddit Share Prices Jump Following Data-Sharing Agreement with AI Firm OpenAI
Summary:
Social media platform Reddit's shares rose 11% in after-hours trading following a new data-sharing agreement with OpenAI, the creator of AI chatbot ChatGPT. Reddit will allow OpenAI to access its Data API for content collection, while OpenAI will provide innovative AI capabilities to boost Reddit user engagement. Despite looming legal issues over data collection methods, AI companies continue to forge partnerships, with Reddit also collaborating with Google in a $60 million deal earlier this year.
After sealing a data-sharing agreement with OpenAI, the creator of artificial intelligence chatbot, ChatGPT, social media platform Reddit's shares surged 11% in after-hours transactions. As part of this collaboration, Reddit will grant OpenAI access to its Data API, enabling the live collection of content from its users' posts. This move is set to enhance ChatGPT’s capabilities and the development of new products. In return, Reddit's users and administrators will gain access to a selection of novel AI-driven features intended to elevate user involvement. Reddit has also enlisted OpenAI as its most recent advertising collaborator. Although Reddit's shares suffered a 5.45% drop on May 16, they bounced back by 11.05% to USD 62.61 after the alliance was made public after the closing bell, according to Google Finances. Reddit signed a parallel agreement with Google in February valued at approximately USD 60 million.
Reddit is known for its continuous endeavors to boost community participation and to generate income beyond advertisement placements. This particular agreement comes at a time when AI companies such as OpenAI are dealing with an increasing number of lawsuits over their data collection techniques. These legal claims suggest that these firms might have unlawfully taken copyrighted materials and personal data.
Last May 16, Sony, the largest music publisher worldwide, sent warning letters to over 700 enterprises, including OpenAI, Microsoft, and Google. Sony alleged that these companies might have employed its music in training their AI models without prior approval, according to various sources.
Reddit previously had Community Points, a blockchain-based reward system, but it was discontinued in October due to scalability issues. Reddit announced in February that it had Bitcoin and Ether in its financial reserves and even permits users to purchase specific virtual commodities using Ether and Polygon.
This news has been followed by the impressive success story of Sandeep Nailwal, co-founder of Polygon, from hardship to wealth.
Published At
5/17/2024 8:12:52 AM
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