The agreement improves the understanding and presentation of Reddit material using OpenAI’s capabilities. The AI company will support new social platform features.
Reddit (RDDT) rose 11% in after-hours trading. The social media company and OpenAI reached a data-sharing agreement. OpenAI is the creator of the artificial intelligence chatbot ChatGPT.
Reddit declared on May 16 that OpenAI will have access to their data API. This will deliver content from Reddit postings in real-time. The main goal is to add Reddit content to ChatGPT and other new products.
OpenAI will provide new AI-powered services to Reddit users and moderators in return. Increased user involvement is the aim of these features.
Reddit also announced the AI company as its newest advertising partner.
Reddit’s shares dropped 5.45% on May 16. But Google Finance said the collaboration news following the bell sparked an 11.05% surge that saw the stock reach $62.61 in after-hours trading.
In February, Reddit signed a similar agreement with Google. He was reportedly valued at $60 million.
Reddit has always prioritized growing income sources beyond advertising and enhancing community involvement.
The agreement comes as OpenAI faces increasing lawsuits. According to these complaints, the companies trained their models illegally using private data and copyrighted content.
The largest music publisher in the world, Sony, wrote letters to more than 700 firms on May 16. These included Google, Microsoft, and OpenAI, which create AI. Several publications claimed that Sony stated that they had “reason to have” that they may have trained their models using its music without permission.
Community Points was Reddit’s previous blockchain-based rewards program. But last October, the company closed it due to scalability issues.
Reddit revealed in February that it had Ethereum (ETH) and Bitcoin (BTC) in its currency reserves. It also enables users to pay with Ether and Polygon (MATIC) for certain virtual items.
