X Eyes Split of Premium Service Into 3 Ad-Based Tiers

“Blue checks” may get company as the debt-laden social media platform seeks to increase revenue from users

White check marks in blue bubbles on a blue background.
X Corp. may soon add two tiers to its paid subscriptions.

First there was a fee for “blue checks.” Now, X Corp. is testing two additional paid tiers of premium service as it chases user dollars.

The social platform formerly known as Twitter is considering splitting its $7.99-per-month plan into three different segments, with prices based on how many ads are shown in user’s feeds, Bloomberg reported Friday.

The tiers — Basic, Standard and Plus — would be aimed at users who may not want to pay the full $7.99 per month for the existing premium service, the report said, citing details from a call with the company’s lenders Thursday relayed by a person who dialed into the discussion.

Details on potential prices were not revealed, but that suggests that the newer tiers would be priced lower, and goes along with public musings by owner Elon Musk about charging all customers a small fee to use the site in an attempt to thwart bots.

X user @aaronp613, who Bloomberg called an app enthusiast who examines code withing popular iPhone applications, posted that the code suggests premium “Basic” tier would have a full ad stream, the “Standard” tier would have “half” ads, and the “Premium Plus” would have no ads.

X CEO Linda Yaccarino during the call also repeated to lenders what she said at last week’s Code Conference: that advertisers are returning to the site, after fleeing en masse following Musk’s buyout of the company in October and subsequent loosening of standards regarding hate speech.

Recent data showed that domestic advertising was down at least 55% each month since Musk bought the platform.

Last week Yaccarino said that 90% of the top 100 advertisers on the platform have returned. Thursday Yaccarino expanded on that statement, telling the bankers that while advertisers are returning to the social media platform, they’re not spending as much as they did in the past.

Nevertheless, Yaccarino said revenue is growing in the high single digits quarter-over-quarter across advertising, data licensing and subscriptions, Bloomberg reported.

In fact, she said, not including the cost of servicing the company’s $13 billion in debt, the company already is cash flow positive, according to the report. By the end of 2024, she said the company will be cash flow positive including debt payments.

That comment added some detail to a statement last week that the company would be in the black by the end of next year.

X owes about $1.2 billion in interest payments per year on its debt, Bloomberg estimates, the result of his financing deals for the $44 billion takeover of the company a year ago.

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