social media companies are no longer treating AI like it's a side feature.
I think more and more we're seeing that they're kind of positioning it as a core way that users are gonna either discover content and then eventually, how platforms are actually going to make money.
Today on the show, I want to talk about some new things coming out of Meta.
They're testing a standalone app for AI video-generated content and also Reddit, who is looking to AI search as kind of their next money-making monetization method, which is really interesting.
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All right, let's get into what's going on with AI and social media.
Reddit has just made a really interesting case.
They were talking on Thursday to their investors and they said that AI-powered search could become one of the most important long-term revenue opportunities for Reddit, which is interesting.
This was during their fourth quarter earnings call.
So all of the executives over at Reddit were, I think, really actively kind of merging their traditional search experience with generative AI search.
But they suggested that, while search wasn't yet monetized, that there was a huge opportunity there, which I think is interesting right.
I mean, we see Google obviously monetizing search, but they've been doing that for years.
And so AI and search isn't anything new.
We see perplexity as kind of a big player in the space.
But right now, Reddit's bet is that generative AI is better suited to the kinds of questions that people actually ask on Reddit.
So this is what their CEO, Steve Huffman said.
He said, there's a type of query we're particularly good at.
I would argue the best on the internet, which is questions that have no single answer.
The answer is actually multiple perspectives from lots of people.
So his argument basically is that traditional search engines Google, but I think you could even say perplexity in this are basically optimized for navigation.
They help you find a link or a destination.
And he's saying that these LLMs, by contrast, are synthesizing content nuance and then they're kind of showing some competing, different viewpoints, which naturally maps to Reddit's discussion-driven content.
He thinks that that combination is where Reddit is going to be headed.
He said user behavior is... basically showing that the strategy is gaining a lot of traction.
Reddit told their investors that weekly active users for search grew 30 over the last year, up from 60 million to 80 million.
They said that their AI-powered product, Reddit Answers, has grown even faster.
It went from 1 million weekly active users in Q1 last year to 15 million by Q4.
So Reddit is now investing in basically making those AI answers really rich, really engaging.
And they said that they're modernizing the interface to include more media heavy responses.
They've done a bunch of pilots that are kind of underway right now, but they Also rolled out Reddit answers in five new languages and they're testing dynamic AI agents that appear alongside search results, including results that kind of extend beyond the text.
So this is really interesting.
I think, underneath of all of these different product updates that they're rolling out, there's kind of a bigger shift in how Reddit is looking at themselves.
So it's kind of interesting if you listen to like some of their executives talking to investors.
They're basically saying that they're going to prepare for a future where Reddit isn't just a social network, which is, of course, what we all know Reddit for.
It's always been a social network.
But they're saying that this is going to be more of a destination for answers.
Right.
So, I mean, I think we're used to it.
And it's kind of interesting how they're separating that.
As part of that transition, they're kind of planning to eliminate the distinction between like logged in and logged out users.
And they're going to start doing that in the third quarter of this year.
And instead Reddit is going to be basically a personalized experience that uses AI and machine learning to show you the responses of people that would most likely answer your question right.
So like if you ask a question, the answer they're going to pull from threads similar to your question and show the ones that are most likely to respond.
So it's not just AI generated answers.
It's like AI finding human generated answers that are most likely to answer your question.
It's really interesting.
And basically they're gonna tailor the content to whoever shows up, regardless of whether they have an account.
So they're able to do this, not just for users that are logged in, but also logged out.
I mean, basically they're saying Reddit is the internet.
And if you could look at an old analogy, it's like searching on Google.
And instead of, you know, showing a bunch of websites, they're showing a bunch of people's specific responses, but they're organizing responses to questions.
So it's not just like you know, in the olden days I think you'd go on Reddit, you would ask a question, you would see a thread and you kind of read through all the comments on the thread.
But maybe some of the comments on the thread don't align with what you believe or they aren't relevant to your particular part of the question, right?
Because lots of threads on Reddit can have, you know, someone asks like four questions, then people answer different parts of that.
Maybe you only need to be answered to one part of this.
So it's really an interesting concept that they're treating the responses themselves as results and feeding you the responses that are most likely to answer your particular question.
Really cool.
So right now they said that they're also kind of looking beyond just their own platform.
They have content licensing.
They have a content licensing business which basically lets other companies train AI models on their data.
They said that that's grown a lot.
That revenue is about.
They reported that it's under Reddit's non-advertising category, which is about.
I think it grew about 8 year over year to about 36 million in the fourth quarter.
And that's up 22% to $140 million for the full year.
So last year, it's $140 million that they made.
I think right now, obviously, AI is growing.
The demand for it is growing.
I think Reddit's huge pile of data and human conversations is just a super valuable asset.
And then I think Reddit isn't alone in thinking, in trying to rethink how AI is going to change social platforms.
So the other story I wanted to talk about is Meta and how they are also changing their platform for AI.
They were talking on Thursday and they said that they are testing a standalone version of Vibes.
So it's basically an AI-generated video app.
And you can.
I mean it's basically like competing with OpenAI, who made Sora their own standalone video app.
Now, Sora, I've also seen a lot of news headlines that it has kind of crashed in usage.
It's, you know, it was like a fun tool that people would go on there and use.
I personally remember it was a big pain, but I got a lot of people... um invite code so they could sign up for that because it was like invoice only and after you know i don't know playing with it for a couple minutes i mean no i didn't really want to scroll through ai slop videos so i just moved on i think i don't think it's like completely dead but i don't really think you need to have like an ai generated platform for video per se i think eventually if people are just using ai and it's you know once the ai video generators are good enough they don't it's hard to differentiate between real footage I think people are gonna probably just start merging the two and you're just go back to using the regular platforms that you have always used but you know then I think a lot of these companies are like well we don't want to know generate tons of slop and spam the whole internet so we want to build like a custom a specific place where it's just ai generated so i think there's a lot of those kinds of things that they're grappling with and meta evidently is in the middle of all of that vibes launched in september last year and it's just inside of the meta ai app but it basically lets you create and share short form videos that are i mean they're just 100 ai and i think the feed looks really similar to tick tock or like instagram reels right you're just swiping through it but everything's ai generated Meta didn't actually share any specific usage numbers.
I think everything's going to look tiny compared to Instagram, Facebook and WhatsApp.
But they did say that engagement inside of Meta AI is growing a ton which I think they kind of view as a signal that there is demand for a dedicated vibes product and them spinning that out.
They also said that, while a lot of users are already using AI content inside of Meta AI, they said a standalone app would basically give creators and viewers a really clear home for a lot of that.
So vibe lets users basically create videos from scratch, or you can remix content that you see in your feed.
Um, before you post creators can add visuals, right?
So you can add music or you can kind of adjust some of the style, and then finished videos can be shared straight inside of uh vibes.
And then you can also, you know, send them in DMS, or you know, cross post to Instagram or Facebook, or you know reels, all that kind of stuff.
So meta says that right now they're kind of doing this collaborative sharing um through their app.
They said it's getting really popular.
A lot of videos are being sent privately to friends, right.
So it's not just like oh, public my public feed of ai stuff.
It's like you might go make a funny ai video, send it to a friend.
Maybe it's them or you, um.
And i think that right now, because of this um, this kind of fits inside of meta's broader monetization strategy.
They already said that they are testing new premium subscriptions on Facebook and Instagram and WhatsApp.
And I think that they're going to plan to kind of explore some subscriptions for AI features as well.
I mean, you look at Instagram and I think they made an insane amount of money just by adding the blue check mark, like the verified.
You know pay to be verified on Instagram for 15 bucks a month.
I think that was really popular.
I think they made a lot of money from that.
And so I think They're looking at more ways to monetize, you know, using something like vibes, where you'd have to get credits and AI credits to actually go and generate videos.
Seems to be what's working.
They right now have a free tier, but I think they're going to introduce kind of a paid you know a paid subscription where you get more credits and probably better you know better models in the future.
So I think if you look at the whole, you know the whole system and the whole industry right now between Reddit and Meta, both of them are kind of going in the same direction.
I think social platforms are increasingly seeing AI not just as like a tool to enhance the engagement and get people to use them more.
I think they're looking more at AI as a way for people to discover new things, but also to eventually become new revenue streams right,
And so I think right now there's a huge question about whether AI is going to reshape social media.
But also I think it's going to be how these companies are going to be turning this into a sustainable business, because you know you look at how much money Meta is spending on AI.
And of course, people are like, well, they can afford to lose money.
Look at what Zuckerberg did to, you know, the metaverse, just burning billions of dollars on it.
But I think inevitably investors don't like that and the company doesn't like that.
And so I think they do want to make revenue off of a lot of these investments.
And because Meta has invested so heavily, I would not be surprised to see some paid tiers in the very near future where you can pay to get access to more of these AI features.
Thank you so much for tuning into the podcast today.
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Thanks so much for tuning in and I'll catch you in the next episode.
