Reddit Faces FTC Inquiry Over AI Data Deals Ahead of IPO

The Federal Trade Commission (FTC) has set its sights on Reddit's licensing of user data to AI companies, just days before the social media giant's highly anticipated IPO. The FTC's interest in these AI-related deals signals a shift in focus from equity investments to data sharing practices. Reddit received a letter from the FTC outlining a non-public inquiry into the sale, licensing, or sharing of user-generated content for AI model training. While Reddit remains confident in its practices, the FTC's scrutiny raises questions about competition and consumer data privacy in the rapidly evolving tech industry. Despite the investigation, Reddit stands firm in its belief that it has not engaged in any unfair or deceptive trade practices. The company's willingness to share content with AI companies for revenue generation purposes has raised eyebrows, particularly in light of its $60 million deal with Google for AI model training. As Reddit prepares for its IPO, the FTC's inquiry adds a layer of complexity to the company's future prospects.