Regardless of X Premium (previously Twitter Blue) failing to catch on the best way that Elon Musk had hoped, the platform’s eager to search out new methods to spice up its income consumption, because it appears to be like to combine extra AI parts, which come at a big price, whereas additionally offsetting its advert income losses.

Alongside that line, simply earlier than Christmas, X introduced that the value of its X Premium+ subscription tier, the costliest X subscription possibility, can be rising by 30%, with the intention to fund the continued enlargement of its choices.

As per X:

“We’re updating the X Premium+ subscription worth on December 21, 2024. New subscribers pays the up to date worth beginning that day. In the event you’re an present subscriber and your subsequent billing cycle begins earlier than January 20, 2025, you’ll be charged at your present fee; in any other case, the brand new fee will start along with your first billing cycle after that date.”

The brand new worth provides a further $6 monthly to the X Premium+ worth, rising from $16 to $22 monthly, or $229 yearly.

X says that the upper worth level will allow it to supply a totally ad-free expertise for its prime paying customers, whereas additionally enabling larger utilization limits for its Grok AI fashions.

It’ll additionally give X extra capability to pay creators by way of its up to date income share mannequin:

“We’ve shifted our income share mannequin to reward content material high quality and engagement fairly than advert views alone. Your Premium+ subscription payment contributes to this new, extra equitable system the place creator earnings are tied to the general worth they create to X, not impressions of advertisements.”

X introduced this transformation again in October, with this system shifting from offering creators with a lower of advert income for the advertisements displayed of their put up replies (and seen by X Premium subscribing customers), to paying creators primarily based on engagement from paying customers.

The added price of X Premium+ will now contribute to this, by giving X somewhat additional revenue to share, whereas additionally, as famous, funding its ongoing AI improvement.

Although, technically, that’s carried out by way of xAI, which is a separate firm to X itself. xAI, which is in control of the fashions and programs that energy its Grok AI chatbot, simply closed a Collection C funding spherical of $6 billion, including to the $6 billion that it additionally raised again in Might, enabling it to increase its operations.

xAI has used nearly all of that funding to construct its “Colossus” AI knowledge heart in Memphis, which includes 100,000 Nvidia H100 GPUs into the xAI operation. That places it on par with the AI programs presently being operated by Meta and Google, although each of them have considerably extra capability, and functionality, to increase additional at this stage.

However for now at the least, the brand new AI computing cluster has propelled xAI right into a place of respectable competitors on AI improvement, because it appears to be like to realize a foothold within the house, and money in on the anticipated AI increase within the years forward.

How a rise in X Premium+ pricing may immediately contribute to this isn’t clear, however X has continued to pump out new updates for its Grok chatbot (the most recent being improved picture technology), whereas it’s additionally launched a standalone Grok app in some areas.

And it’s utilizing X to advertise this:

So there’s an intertwining there, although the place the traces are drawn between the 2 just isn’t clear, so it’s inconceivable to say how every contributes to the opposite on this respect.

Regardless, that’s one place that X says the additional subscription consumption shall be going. Although as famous, the value improve is also an try to cowl up for the shortfall in X Premium subscribers, which has left one other gap in X’s income projections.

Based on evaluation carried out by TechCrunch and AppFigures again in October, X Premium presently has round 1.3 million subscribers in complete, which includes all tiers of the providing. Of that, solely a fraction can be paying for X Premium+, and as such, a worth improve of $6 on this class isn’t going to be a serious needle-shifter on this respect.

However those that are paying for the highest tier are additionally much less more likely to cancel, so perhaps, X is simply cashing in the place it might. But, the probabilities of X Premium ever turning into a serious income driver, as Elon Musk had initially projected, appear to be impossible at this stage.

In his authentic enterprise technique plan for Twitter, which he shared with potential buyers shortly after he took over on the app (and earlier than the “X” re-brand), Musk predicted that Twitter Blue (now X Premium) would attain 69 million paying subscribers by 2025, and 159 million by 2028.

It’s a protracted, good distance off that, and out of doors of worth will increase like this, it’s onerous to see how X will be capable of generate any actual income traction from its subscription choices.  

Until it comes out with some mind-blowing add-ons to sweeten the deal. I’m unsure what they might even be, nevertheless it appears probably that AI will play a component in some way.

Personally, I keep that social platforms are over-valuing the utility of options like AI picture creation to common customers. However perhaps Elon and Co. have one thing else up their collective sleeves.