In a regulatory filing, Reddit announced that the FTC is probing Reddit’s proposal to sell, license and share user-generated content with third parties to train artificial intelligence (AI) models.  This move underscores the growing scrutiny over how online platforms harness the vast amounts of data they collect, particularly in the context of AI development. 

The investigation brings to light several legal considerations that could have far-reaching consequences. Importantly, it highlights the importance of clear and transparent user agreements including terms of service and privacy policies. Users must be fully aware of how their data is used, especially when it contributes to the development of AI technologies. This approach tracks with the FTC’s stance that companies seeking to use consumer personal data to train AI models should notify consumers meaningfully rather than surreptitiously change user agreements.

The FTC’s actions signal a more aggressive stance on data privacy and usage, particularly in relation to AI. For the tech industry, this could mean a shift towards more stringent data handling and consent practices. Companies may need to reassess their data collection and usage policies to ensure compliance with emerging legal standards. Furthermore, this investigation could pave the way for new regulations specifically addressing the use of personal data in AI development.

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