Grok, X's AI Chatbot, Now Available to All US Premium+ Subscribers; English Language Users Coming Up Next

Yesterday, X announced the rollout of Grok, the innovative AI chatbot created by Elon Musk’s xAI startup, for Premium+ subscribers on its platform. Today, Musk confirmed that the rollout for all U.S. Premium+ subscribers is complete. However, he cautioned that the beta version may encounter various issues, although improvements will be made over time. Musk also mentioned a timeline for Grok's expansion to other regions, indicating that all English-speaking Premium+ users will have access within “about a week.” Following that, Japanese users, X’s second-largest demographic, can expect Grok soon, with hopes to make it available in all languages by “early 2024.”

It’s important to note that Musk’s timelines have a history of variability—just ask Tesla enthusiasts who have awaited the full self-driving feature. However, with Grok, he has generally been close to his launch estimates. For example, Musk mentioned on November 22 that Grok would debut for Premium+ subscribers “next week,” yet it officially launched on December 7.

The effectiveness of Grok in generating subscription revenue for X remains uncertain. Currently, Grok is part of X's top-tier subscription plan, priced at $16 per month for Premium+. This is significantly higher than X’s Basic ($3/mo) and Premium ($8/mo) plans, making it less appealing for casual users who can access free competitors like ChatGPT or Google’s Bard.

The Premium+ subscription does offer additional features to enhance its attractiveness, such as an ad-free experience on the For You and Following timelines. Premium+ members also benefit from priority replies, while enjoying all Premium features, including ad revenue sharing for creators, ID verification, and access to Media Studio.

Nonetheless, subscription services have yet to account for a significant portion of X's revenue; advertising has historically dominated. Currently, X's advertising future appears uncertain as Musk's provocative remarks have alienated key advertisers, leading some brands to exit due to concerns over antisemitic content on the platform. To sustain its business, X must attract a larger Premium+ subscriber base to offset declining advertising revenue, especially with major brands like Apple, Disney, IBM, and Walmart distancing themselves from the site.

Interestingly, November marked a milestone for X, generating its highest-ever subscription revenue at $6.2 million, net of app store fees, according to estimates from app intelligence firm Apptopia. However, this figure pales compared to Snapchat's in-app subscription revenue, which exceeded $20 million for the first time last month.

In summary, X has significant potential to grow its subscriber base, especially with over 500 million monthly active users. Whether it can effectively capitalize on this opportunity remains to be seen.