Amber Neely
With Apple announcing Fitness+ during Peloton's first investor meeting, Peloton's CEO was immediately questioned about Apple entering the same business.
Apple announced Apple Fitness+, a streaming fitness program for Apple Watch wearers, at the September "Time Flies" event. The service seeks to combine the health-tracking capabilities of the Apple Watch with instructor-guided workouts.
The move has made Apple a direct rival to Peloton, another company known for making high-end workout equipment — treadmills and stationary bikes — and pairing them with streaming fitness content.
The announcement came in the middle of Peloton's first-ever investor meeting as a public company. As a result, Peloton shares dipped slightly, but have been up about 4% just prior to publication.
"We're just digesting the announcement like everybody," Peloton's CEO John Foley told CNBC. "The biggest thing I will say is it's quite a legitimization of fitness content, to the extent the biggest company in the word, a $2 trillion company, is coming in and saying fitness content matters. It's meaningful enough for Apple."
He suggested that Peloton continued to distinguish itself by providing equipment, which Apple does not.
"They're not coming into that [hardware] category," Foley said about Apple. "They're just going to be the content. And we think the special sauce, the magic, is our connected platforms and in order to work out at home you need a stationary bike if you're going to be biking, you need a treadmill if you're going to be running."
Peloton's equipment is targeted toward a different audience — those who are willing to spend thousands of dollars on getting fit. Peloton's cheapest bike costs $1,895, while their Peloton Tread+ starts at $4,295. Peloton offers two different membership options, too. A $13 tier allows a single user to take Peloton fitness classes and doesn't require any Peloton equipment. A $40 tier requires a Peloton Bike, Bike+ or Tread+, and gives a full family access to health metrics, guided workouts, and more.
Conversely, an Apple Watch Series 3, the minimum requirement to access Fitness+, costs $199. A subscription to Fitness+ will be $9.99 at launch and will cover up to five family members.
Recently, Peloton announced a new Peloton Bike+, which will easily pair with the Apple Watch through GymKit.
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6 Comments
Wow what a good attitude from this guy. I was expecting a snarky remark like Spotify or Epic.
Maybe Peloton is a company Apple could team up with. A Beats style acquisition where they work as a subsidiary would be ideal but maybe too expensive at this point.
As it is, I don't think Apple is a threat to peloton. Yes, peloton offers yoga and strength classes but their core offerings are related to the bike and treadmill. I could be wrong, but I doubt many people sign up with peloton strictly for the other content; rather they get the bike and take advantage of the other content.
I don’t think they’ll be cannibalizing each other that munch. I believe they’ll actual help each other by expanding the curated home fitness market. Kind of like how fast food chains do better when they’re close to other fast food chains. In the age of Covid, they’ll both take market share from fitness clubs.
John Foley assessed the Apple announcement and realised that, while there is a overlap in what they offer with respect to training, the hardware is at opposite ends of the price spectrum.
Fitness videos have always been available, on apps as well as free Youtube videos, but offerings like Fitness+ will hopefully be more organised and will help Users be a little more disciplined.