Let's talk about how LLMs will affect RDDT and why I think Reddit is forfeiting its moat.

CEO Steve Huffman in Q2 earnings call: >"So I think one of the things that we've learned, particularly through the data licensing deals is... how essential Reddit is to AI or LLMs as we know them and the next generation of search." My biggest fear of Reddit is they're licensing away their moat. Giving up long-term value for short-term gains. Here's why I'll keep it high-level because getting into model-training is a topic of its own. LLMs use the same data that is available on the web, to provide the answers to you. Common Crawl is one method which is a repository that anyone can use which contains all retrieved data from the open web that can be trained to improve their model. But the issue is it contains all sorts of text, including racist, homophobic, plain inaccurate and overall low quality content. So LLM's love Reddit. It is a massive repository of first-party (ie owned by Reddit) data where real users provide high quality content to other users. OpenAI licenses this data to train their model on "what good looks like" so that the answers provided to you, closely match the answers provided by real Redditors. So what's the problem? The problem is once OpenAI or other LLM's feed all the licensed data out of Reddit and into their models, then effectively there is no more use left of Reddit. Let's say your car is making a funny sound and you asked GPT to diagnose it, ChatGPT can pull high-quality data out of the sub-reddit for your make and model, cross-reference against other sources like car repair forums and give you the same responses that other redditors would have given you This is not farfetched, it's simply the data that already exists. If Reddit continues in this path, then in a few years at most (probably max 2), ChatGPT can provide precise answers and you don't need another redditor to help you for anything when you receive sub-second responses curated for your use-case. What am I missing? Any Reddit bulls here? On a valuation perspective it looks fantastic.