Universal Music Group Steps Into The $23 Billion Work-Out-From-Home Trend With Equinox Deal

CBx Vibe:Go DJ” Lil Wayne

  • Universal Music Group is licensing its catalog to Equinox’s Variis digital fitness app
  • The home fitness equipment market that’s expected to reach a value of $23.2B by 2025

The world’s largest music publisher Vivendi (VIV.PA -0.19%) owned Universal Music Group (UMG) is taking its talents to the at-home fitness world by licensing its catalog to Equinox’s Variis digital fitness app. This deal will allow users to enjoy tracks from UMG artists like Drake, Rihanna, Kendrick Lamar, and The Weeknd. As a multitude of fitness-minded individuals continue to purchase at-home exercise products, are UMG and Equinox banking on the home fitness equipment market, that’s expected to reach a value of $23.2 billion by 2025, to become the next true growth sector?

Why This Matters: Global recorded music, which falls into the streaming category, has been on an upward trajectory thanks to the adoption of streaming and better digital connectivity powering at-home fitness apps. Goldman Sachs estimates that the global music business, especially recorded tunes will reach $80 billion by 2030. When you incorporate the streaming revenue with the sales of fitness equipment that have experienced a rapid rise due to the pandemic you can see how this is a win, win for both companies. During the “first wave” of the coronavirus, NPD Group reported that in March alone, fitness equipment sales rose 130% year-over-year.

NPD Group reported that in March alone, fitness equipment sales rose 130% year-over-year

Competition is steep in this connected at-home fitness space with a third wave of the pandemic looming. Brands like Peloton (PTON +1.02%), Tempo and Vi are hoping to benefit from the continuous stay-at-home orders with their entry-level products. Many of these connected at-home fitness makers have reached noteworthy agreements in the music industry. Equinox sells SoulCycle at-home bikes that compete directly with Peloton’s only connected fitness product.

One of the biggest luminaries in the sector, Peloton, settled an ongoing copyright infringement lawsuit involving 14 music publishers last February. Since then, the leader in at-home stationary bikes has pivoted to direct deals with artists. In November 2020, it announced a multi-year partnership with Beyoncé, along with crafting exclusive music starting with three Elvis renditions from Chromeo, Big Boi, and Dillon Francis. On the sales-growth side, Peloton has experienced a huge uptick in its share price since the pandemic started, increasing more than 390% in the past year.

What’s Next: The Equinox and UMG deal is the latest in a long line of noteworthy professional moves from the latter company, ahead of an expected 2022 stock-market debut. Vivendi is reportedly planning to spin out a portion of UMG, separate from Tencent’s 20% stake, according to Music Business World.

CBx Vibe:Go DJ” Lil Wayne


CultureBanx Team

Welcome to CultureBanx, where we bring you fresh business news curated for hip hop culture!