Is Reddit A Gold Mine for AI?
In a recent interview, Reddit CEO Steve Huffman called the platform a “gold mine” for AI.
Of course, what could he say about his platform outside of leveraging the AI buzz to boost its valuation further? Right? Well, there is some truth to it.
Indeed, as AI Chatbots and features, from OpenAI’s ChatGPT to Google’s AI Overviews, started to scale up their adoptions, they also looked into ways to make their own AI more reliable, more interesting, and better able to incorporate real-time content on the fly.
That is where Reddit came into the picture.
In short, Reddit’s unique voting and community system filters discussions, thus, in theory, setting it apart from other platforms amid rising AI-generated content across the internet.
For that reason (and to be clear, a lot of content on Reddit is worthless, yet), its real-time, user-generated content has become extremely valuable for AI players!
As a source of pre-training data for foundational models like GPT.
Real-time data is to be fetched into AI engines like Perplexity to serve the most up-to-date information based on user-generated content available on platforms like Reddit.
That enables Reddit to make money in two ways:
In the first case (curated user-generated content for pre-training), the business model will be a licensing deal to access that data for pre-training.
The business model for the second case (real-time user-generated content for inference) is consumption-based access to real-time content generated by users.
To understand the above, let me give you a step-by-step understanding
As Reddit IPOed, the most interesting aspect of it has nothing to do with its core but with something else related to how AI is reshaping the whole business modeling landscape for these companies.
Let me give you some insight into how social media (and, more generally, user-generated platforms) business models might change.