X – Formerly Twitter – To Test Three Tiers Of Service

X Corp. plans to introduce a three-tiered premium service to diversify revenue streams.

Elon Musk’s X Corp., previously known as Twitter, is gearing up for a major transformation by introducing a three-tiered premium service to offer customers various options and generate additional revenue streams. The company presented its plan to lenders, highlighting their actions to revive growth and address financial challenges.

The existing premium plan, priced at $7.99 per month, will undergo a restructuring, being divided into “Basic,” “Standard,” and “Plus” variations. This move will allow X Corp. to tailor its services to different customer needs and preferences, charging varying amounts based on the number of ads displayed to the users. X Corp. has seen advertisers come back to the platform, but they are spending less money than before. Linda Yaccarino, the CEO who started in June, is optimistic about the company’s progress. She emphasized that revenue is steadily increasing in the high single digits across advertising, data licensing, and subscriptions.

X Corp. expects to achieve positive cash flow by the second half of 2024, even after accounting for debt payments.

Elon Musk’s acquisition of Twitter amounted to $44 billion, accumulating a significant debt load of $13 billion. Musk’s unconventional decisions and looser content-safety rules have posed challenges for the company’s financial landscape, causing concerns for some advertisers. X Corp., previously earning around $5 billion in annual sales predominantly from advertising, is now focused on regaining and surpassing that revenue level. Roughly 90% of the company’s top 100 advertisers have returned, showcasing a positive trend.

However, advertising spending has yet to reach historical levels, with companies adopting a more cautious approach.

“X Corp. is implementing strategies to restore its financial health and diversify its revenue streams. The introduction of a premium subscription service is just one part of a broader vision to turn X into an “everything app” that generates revenue through various features like shopping and payments,” writes Aisha Counts of Bloomberg.

The platform is actively working on involving celebrities, political figures, and commerce interactions. This demonstrates their commitment to engaging users and advertisers in a dynamic way. Partnerships with Paris Hilton and 11:11 Media show the company’s focus on promoting live shopping and video products.

Source: Bloomberg