Reddit has entered into a $60 million annual deal with an AI company to use its user-generated content for AI model training.

The deal is part of Reddit's preparations for a potential IPO in March, which could value the company at $5 billion.

This move is indicative of a broader trend where AI firms seek data licensing agreements, mirroring OpenAI's partnerships with publishers.

Reddit's founder had previously indicated intentions to monetize the platform's vast user content by charging AI companies.

Privacy, copyright, and the sustainability of generative AI are concerns that have emerged from such data licensing deals.

Despite internal company drama, Reddit has seen its revenue grow to over $800 million in 2023, a 20% increase from the previous year.

The response of Reddit's user base to their content being utilized for AI training remains uncertain, and Reddit has not issued a statement on the matter.