Google’s direct integration of content such as Reddit user product reviews could help it shore up its search business.
In a strategic move, Google has secured a new deal with Reddit to obtain exclusive access to the platform’s data. Last week, it was reported that Reddit had signed a contract worth $60 million annually to sell its data to a major AI company. While many speculated that the buyer was OpenAI in their efforts to compete with Google in search, it was actually Google who sealed the deal. This agreement will provide Google with valuable information for both its Search business and ongoing development of its Gemini models.
According to Google, a growing number of people are using their platform to search for useful content on Reddit, such as product recommendations and travel advice. Recognizing the value of this information, we are working to enhance access to it across our products. Through this partnership, we aim to showcase more Reddit content in a user-friendly manner that will both benefit our users and encourage participation in Reddit communities and discussions. This is a strategic move, as Google has observed a trend of individuals adding “site:www.reddit.com” to their searches for genuine user experiences and insights, particularly with the growing doubts surrounding on-site product reviews.
As demonstrated in this sample, using Reddit to search yields forum links containing genuine discussions on products and their features, with ratings to showcase the most pertinent results. This adds considerable worth to your search, especially considering the rise of generative AI and the increasing use of AI bots by product review platforms to generate deceitful endorsements. In light of this, the importance of such a feature is likely to grow even further.
Through the integration of Reddit’s Data API, Google gains access to a wealth of real-time, organized, and exclusive content from their constantly evolving platform. With this new tool, Google can efficiently access current information and utilize improved signals to gain a deeper understanding of Reddit’s content. This will enable us to effectively display, train on, and incorporate it into our systems with utmost accuracy and relevance.
Integrating with Google will prove advantageous for Reddit as it will increase recognition of its forums on a wide range of niche topics. This partnership would not have been possible in the past due to Reddit’s history of hosting chaotic and controversial communities.
In 2020, Reddit implemented significant changes to its rules. This led to the swift removal of numerous controversial subreddits. At the time, the focus was to revamp Reddit’s user experience and increase its profitability with an eye towards a future IPO. The recent partnership with Google serves as strong validation of this strategy.
Although an extra $60 million per year may not cause a revolutionary increase in the company’s total income (Reddit supposedly earned $800 million in ad revenue last year), the added advantages of increased exposure could elevate the deal’s significance, rendering it a crucial strategic move.
Given Google’s dominant position in the market, you might expect that a newcomer like Reddit would benefit from the growth of its data as a challenger. However, this is not necessarily true – Google already has access to all of Reddit’s information through Search, without needing to rely on its potential for growth. This partnership is an important validation of Reddit’s evolving strategy and comes just before the rumored IPO next month. It will be intriguing to learn more about their collaboration with Google in the meantime.
