Reddit Reveals Plan For AI-Powered Search And Paywalled Subreddits

Reddit bills itself as "The Frontpage of the Internet," and it leveraged that reputation earlier this year when it went public. The company has just issued its second earnings report, and CEO Steve Huffman gave some hints about where the social news aggregator will go next, but you might not love it. Reddit users can apparently look forward to AI-powered search and paid subreddits.

Plenty of big technology firms are working on building generative AI models, most of which end up being glorified chatbots. Reddit has not dipped its toe in those waters yet, but it does have a partnership with Google to use its content as training data. Huffman told investors during the call that AI-powered search will begin testing soon.

"Later this year, we will begin testing new search result pages powered by AI to summarize and recommend content, helping users dive deeper into products, shows, games and discover new communities on Reddit," Huffman said. He went on to explain that the feature will rely on both in-house and third-party tools, suggesting Reddit will begin developing at least some generative AI features itself. Presumably, Google will fill the gaps as the two are already cooperating, and Google is one of the few companies that can afford to invest in AI accelerator hardware at scale, and Reddit gets a lot of traffic.

After so many lackluster AI announcements from technology firms, it can be easy to wave off Reddit's plans, but search on the site has been notoriously terrible for years. Large language models like Gemini and ChatGPT are of questionable utility for creating content, but they are quite good at summarization. This seems like a better application of generative AI than most ideas we've heard.


The other upcoming change is a little harder to get behind. Huffman says the site is looking at ways to offer premium content inside Reddit. "We will unlock the door for new use cases, new types of subreddits that can be built that may have exclusive content or private areas, things of that nature," he said.

That points to paid subreddit communities, which would be a major departure for a platform that has always relied on advertising revenue. Reddit would no doubt claim a piece of any subscription fees paid to access these communities.

Investors seem unsure what to do with Reddit. The site has extraordinary traffic, but it still doesn't make money. It is losing less of it, though. The latest results show a $10.1 million loss, down from $575.1 million in the previous quarter. The stock price has been sliding over the past several weeks, and investors might want to see some cash flow before they fully commit.