Peloton Raises Subscription Fees, Cuts Prices for Bikes and Treadmills

Lauren Thomas, reporting for CNBC:

Effective June 1, the price of Peloton’s all-access subscription plan in the United States will go up to $44 per month, from $39. In Canada, the fee will rise to $55 per month, from $49. Pricing for international members will remain unchanged, Peloton said. The cost of a digital-only membership, for people who don’t own any of Peloton’s equipment, will still be $12.99 a month.

Peloton explained the decision in a company blog post shared with CNBC. “There’s a cost to creating exceptional content and an engaging platform,” the company said. The price increases will allow Peloton to continue to deliver to users, it added. [...]

The price of its Bike will drop to $1,445 from $1,745. The cost includes a $250 shipping and set-up fee. The Bike+ will drop to $1,995 from $2,495. The Tread machine will sell for $2,695, down from $2,845. The Tread cost includes a $350 shipping and set-up fee.

Hey, prices go up. Inflation is running high. OK. But raising the prices only for people who already paid for Peloton’s premium-priced hardware and not for people on the digital-only plan doesn’t pass the sniff test that this is about the cost of content creation. If it were really about content creation costs, they’d raise subscription prices for everyone, or, only for the people who haven’t also purchased Peloton devices that cost $2000 or more.

It’s not like $39/month was cheap. It seems transparently obvious that they’re just soaking their best and most loyal customers — the ones whose hardware purchases have tied them to Peloton. (Unsubscribe and your bike or treadmill still works, but the display becomes useless. Update: Well, not totally useless. The display will still show you basic dashboard stats, like time, resistance, and distance — you just can’t use the display to show classes or anything entertainment-related.)

So the message to prospective new buyers is “We’ve lowered prices on our hardware; buy one today and we’ll squeeze you for more later.” Good messaging.

★ Thursday, 14 April 2022