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Reddit weighs restricting Google access as AI licensing talks continue
The dispute centers on a 2024 AI licensing deal reportedly worth about $60 million annually, as Reddit argues Google’s AI search may be cutting referral traffic to its site.
Reddit shares fell after reports said the company is considering limiting Alphabet’s access to its user generated content, a potential shift in how publishers and AI companies manage rights to online data, Yahoo Finance reported.
The reported move is tied to renewal talks between Reddit and Google for their artificial intelligence licensing agreement, signed in 2024 and reportedly valued at about $60 million per year. Reddit is evaluating whether the current licensing arrangement fairly reflects the value of its content in the AI era, particularly as Google’s AI powered search reportedly answers questions directly and reduces the need for users to visit Reddit.
The stock reaction reflected competing considerations: losing the negotiations could threaten a lucrative, high margin licensing revenue stream and potentially reduce Reddit’s visibility in Google Search, while improved terms could increase the long term value of Reddit’s data licensing business. The article also notes Reddit’s content archive is seen as valuable data for training large language models.
Reddit hosts millions of user created communities, or subreddits, and generates most revenue from digital advertising, while it continues expanding, according to Yahoo Finance.