At the open of trading, Reddit shares dropped more than 10%, hitting a low of $166.13. Reddit’s leadership is considering revoking Google’s access to its platform, as both parties are currently negotiating the renewal of their existing data licensing agreement. In 2024, Reddit signed an agreement with Google estimated to be worth $60 million annually, granting Google permission to scrape its forum content to advance AI development. Reddit is now reconsidering this agreement, primarily because Google’s AI-generated summary boxes directly answer questions on search pages, eliminating the need for users to click through to external forums like Reddit.
Reddit shares drop over 10% as it considers ending its data deal with Google
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Summary
Reddit shares dropped more than 10% in early trading to $166.13 as the platform considers ending its data agreement with Google. The 2024 deal, valued at $60 million annually, allows Google to use Reddit content for AI training. Concerns have emerged over AI-generated summaries on Google Search reducing traffic to Reddit forums. Inflation data and developments in AI and crypto remain key market drivers.
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