In late 2023, ahead of its March 2024 IPO (NYSE: RDDT, $34/share), 📝Reddit made significant privacy and data policy changes to boost ad revenue metrics for public market positioning.
Tracking Opt-Out Removal
Reddit updated its privacy policy to remove the user opt-out for personalized advertising based on activity. Ad personalization became default-on with no toggle to disable. The policy expanded Reddit's ability to use personal data for "improving advertising" and sharing with business partners.
Data Licensing Deals
- Google (February 2024) — reported $60M/year deal granting Google access to Reddit content for AI training, disclosed in Reddit's S-1 filing
- OpenAI (May 2024, post-IPO but negotiated pre-IPO) — Reddit data for model training in exchange for ChatGPT feature access
- Reddit's S-1 listed data licensing as a new revenue stream, noting $203M in "other revenue" potential
Community Backlash
Users called the quiet removal of ad-tracking opt-outs a betrayal of Reddit's community-first ethos. The changes compounded frustration from the June 2023 API pricing revolt (which killed third-party apps like Apollo). Users pointed out the hypocrisy: Reddit charged developers for API access while selling the same user-generated content to AI companies without consent or compensation.
This is the same playbook 📝Discord is running now — bankers at Goldman and JPMorgan tell you what the business needs to look like for public markets, and the platform complies. Community backlash is the cost of doing business on the path to IPO.