The dual ad-based and paid ad-free model doesn't work. The existence of an ad-free version devalues the ad-based model. The most attractive customers will pay for the ad-free version so advertisers won't pay you as much. And you can't pay Twitter's bills on the 0.1% of users who'll pay $5 a month. Ad-based is the only viable solution. They'll lose a tiny minority of ad-hating zealots and profit meanwhile.