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A Monopoly on Muscle

THE DAILY REFORMER (NEW YORK, UNITED STATES)

I’ve covered all but two of the Arnold Classics over the past decade, and in each successive year, one fitness equipment brand name has loomed ever larger: Rogue Fitness. I was there in 2017 when Rogue rolled out one of the craziest contraptions in recent history, the “Wheel of Pain,” a faux-medieval torture device the king-sized competitors in the annual strongman competition were required to push in a circle. The device was massive, a brutalist-inspired fitness equipment tour de force, an item so expensive, so awesome-looking and impractical, that no gym could contain it. Rogue, this monstrosity seemingly announced, wasn’t here to take part; they were here to take over.

And they have indeed. The fitness equipment industry saw impressive growth in 2020 due to pandemic-necessitated home gyms. Need to buy a ready-made CrossFit “box” that won’t be tied up by supply chain issues with Chinese factories? Rogue manufactures and sells those box setups and is back to shipping them in three to five days. Need a “Westside Barbell” licensed bench press, made in conjunction with one of the country’s best powerlifting gyms? Rogue makes and sells those in Columbus, Ohio, too.

Rogue’s real power play was in converting profits from physical assets into IP assets: They trademarked the term “Strongman” as it applied to their barbells, sleds, grip training tools, sandbags, and other equipment.

In other words, the company trademarked a term—strongman—that had been sitting there in the public domain for years, a term attached to hundreds of products made by dozens of companies, including some homemade and handmade specialty sets, all competing to be at the top of Google searches for terms like “strongman stone” and “strongman log.”

Let me disclose right away: Rogue makes good products. Most of my basement gym consists of Rogue equipment, from the Thompson Fat Pad bench to the trap bar to the squat rack. But the real strongman community, having watched as Rogue used its clout to squeeze out other producers of CrossFit and powerlifting equipment, have been sounding alarm bells.

Kalle Beck, who runs the popular “Starting Strongman” group on Facebook, reached out to Rogue CEO Bill Henniger. While conceding that Henninger could conceivably buy the entire sport of strongman as easily as he bought this heretofore-unclaimed trademark, Beck demanded to know what his intentions were. “I see the concern and don’t want it to be one,” Henniger wrote back. “Any threat [of using the trademark that way] was killed so that the community doesn’t have to worry about it.”

Calum Liptrot, co-founder of Rogue’s much smaller competitor Cerberus Fitness, isn’t persuaded by Henniger’s reassurance. “Rogue has already maxed out the value of a saturated market for CrossFit and powerlifting products,” he says. “And now, it could be argued that they’re trying to buy the entire sport of strongman, up to its showcase ‘World’s Strongest Man’ television event. Their trademark is limited to equipment, but there’s nothing to stop them from going ahead and taking the next steps, literally taking over the entire field. Imagine the NFL owned exclusively by Nike.”

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In other words, while we fitness enthusiasts were oohing and aahing over the “Wheel of Pain,” a Microsoft-sized monopoly was growing behind the scenes.

Rogue is reinvesting the proceeds of its fitness takeover by making beautifully shot Netflix documentaries about stone lifting and strongmen, sponsoring athletes like Game of Thrones star Hafthór Björnsson, and—perhaps more significantly for competing equipment companies—gobbling up design patents that allow them to go to court to stop the manufacture of heretofore run-of-the-mill products now deemed too similar to their own.

“This is a very big deal for consumers,” says economist and business analyst Ben Labe. “There’s a tremendous amount of consolidation in the fitness world, from Instagram influencers to equipment companies to supplement manufacturers. Fitness is more visible because of these stakeholders, who are relying on ‘extremely online’ marketing strategies to get their brand names out there, but the result is that nearly all the profits are flowing up to the 1 percent of brands in that market. And as these brands accumulate more money, they can do the economically rational thing by spending money to stifle choice and competition, which is what buying all these patents and all this IP is really about.”

“Meanwhile, what does the mainstream media do?” Labe continues. “Magazines like Popular Science write articles about the supposedly amazing science behind Rogue’s fairly standard deadlift bar, and nobody questions their shady business practices.”

In 2008, jump-rope champion Molly Metz got a firsthand taste of this cutthroat marketplace. She had patented her speed rope and became alarmed when she saw Rogue starting to advertise a seemingly equivalent speed rope via its social media and YouTube accounts. When confronted, Henniger said, “We are not in the business of violating patents and if there is a patent issue we will certainly address it.”

Metz, hardly a deep pocket like Rogue, responded by suing the company. That litigation remains ongoing. While it continues, Rogue has been aggressively attempting to enforce its own patents. “Rogue sent our U.S. distributor a cease-and-desist letter when we attempted to distribute our Throwing Sandbags,” says Liptrot. “They had obtained a ‘utility’ patent for a cylindrical sandbag from the U.S. Patent and Trademark Office, and our bags were also cylindrical, so that was that. Their patent likely wouldn’t have been granted in Europe, where we’re based, but a threatening letter from a lawyer was enough to shut down the sale of these items in the U.S. before we even launched them.”

“This is business 101. It’s a lot cheaper to lock down a relatively small market than to keep innovating products to try to expand it,” explains Labe. “I’m not saying Rogue isn’t making a quality product, because I’m not qualified to judge that. But I do think it’s smart, if not particularly ethical, to try to buy up the entire field. If you look at their first big expansion, they cut deals with all these CrossFit athletes. That sport was really growing in the early 2010s. Then they seemed to partner up with the handful of players in powerlifting. Now there’s the field of strongman competitors. They’ve got a chance to really consolidate their gains in the field.”

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Chris Duffin, a mechanical engineer who also happens to be a world record holder in various iterations of the squat and deadlift, says that Rogue’s preeminence pushed him and his Oregon-based company Kabuki Strength towards greater innovation and flexibility. Kabuki, like Rogue, saw increased business during the pandemic as sales of home gym equipment skyrocketed, more than offsetting purchases previously made by locked-down or closing public gyms. “Putting aside whether other manufacturers are making quality products—many are, especially if they’re handling the manufacturing domestically—there has not been much honest-to-goodness progression in the way barbells in particular are made, and that’s our mission,” Duffin tells me.

For Duffin, who came out of the engineering management world, the process has been a simple one, given his understanding of both design and IP: He invents new barbell variations, then patents and trademarks them. “The way to compete is by creating products that accomplish things the barbell, which has been fundamentally the same since the early 1900s, does not do,” he says. “That led to our creation of a new safety squat bar, our ‘transformer bar,’ with settings that could switch the lifter into either the front or the back squat positions, as opposed to the conventional safety squat bar, which forces everyone to perform a front squat. And our ‘Duffalo bar,’ the other core product we slowly built our company around, is properly cambered so that it sinks into the back of someone who has been performing the back squat on a conventional barbell and experiencing shoulder pain, as I had been.”

From these two products, as well as the first adjustable trap bar for deadlifting that allows lifters to employ different grips, Duffin built Kabuki from a company with $2 million in sales in 2017 to $20 million in 2020. The company is still a far cry from Rogue’s 600 employees and $160 million in annual revenue, but, more importantly to Duffin, they’re an active player in the game.  “Rogue has its core competency, manufacturing conventional equipment, and we have ours, which is carefully launching useful new products,” he says. “Find your mission, find the community you serve, and expand in that space. Rogue has made smart decisions within their very large lane.”

Liptrot concedes that Rogue has made some shrewd business moves, but he worries about its long-term effects on the sport. “I quit a good-paying IT job to help launch Cerberus,” he says. “My goal wasn’t to get rich. It was to provide gear that supports this community. Cerberus has helped sponsor athletes and donated equipment to strongman competitions, but I never foresaw a world of these enormous prizes for strongman victories. Strongman was a hobby; it wasn’t something where you eked out narrow wins over and over again in this kind of mercenary, professionalized way each year because it was your full-time job.”

“Now, though, to even get your lifting gear approved by a major powerlifting body, you’ve got to hand over hundreds of thousands of dollars. Multi-millionaire Mark Bell, whose Sling Shot brand dominates the powerlifting apparel space, can just step in and buy rules changes that allow folks to use his gears. Rogue is even richer and can simply buy entire sports if they’d like.”

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Longtime strongman competitor Vanessa Adams believes that Cerberus, at least in her opinion, sells the right stuff. “They make better equipment than Rogue at a better price point, and Rogue went after them when their sandbags were used to great effect in a competition,” she tells me. “It’s not a ‘Strongman’ sandbag unless Rogue sells it, even though people like me have been calling various types of equipment used in strongman competitions ‘strongman’ for our entire lives. These aren’t newly engineered products like that Kabuki ‘Duffalo’ bar. They’re just variations on things that anyone should have a reasonable claim to be able to make.”

Labe takes a long view of these market shifts. “Whenever some kind of fad goes mainstream, the initial flurry of excitement is followed by people commodifying the heck out of whatever products are created. What may have begun as an underground thing—some activity undertaken only by a few oddballs and outsiders—is suddenly mass-produced, effectively marketed and put in the hands of the many,” she says. “A couple key players carve up the market, and the rest of us wonder about what might have been.”

To Chris Duffin, who grew up homeless in the Oregon woods at the mercy of pot-growing hippie parents who moved frequently to stay one step ahead of the law, the threat is less concerning.  “I’ve worked with Rogue on distribution and can continue working with them,” he says. “If you’re the only company that can manufacture your specific products and have taken all the right steps to protect that manufacturing process, you’re in a privileged place. If you’re upset that you can’t make or sell a generic sandbag, devise a better one and then take steps to protect its production process and market it accordingly. This was never an innovative field, and there’s lots of room for more innovation.”

And so, to keep the economic “Wheel of Pain” turning in spite of Rogue’s seemingly immovable market-leading inertia, it must be propelled by fitness entrepreneurs who possess the innovative equipment designs and marketplace discipline to ensure it remains in motion.

Oliver Bateman is co-host of the ‘What’s Left?’ podcast.

This article was supported by the Ewing Marion Kauffman Foundation. The contents of this publication are solely the responsibility of the authors.

The post A Monopoly on Muscle appeared first on The American Conservative.

As reported by The American Conservative. Continue reading this article at The American Conservative

All news text, graphics, videos and multimedia content remain the copyrights of the credited original article publisher, in this case - The American Conservative

The Daily Reformer is an American conservative news aggregator and publisher with a mission to provide "the smart take on American conservative news.

Contact Information: amnon (at) thedailyreformer dot com

A Monopoly on Muscle

THE DAILY REFORMER (NEW YORK, UNITED STATES)

I’ve covered all but two of the Arnold Classics over the past decade, and in each successive year, one fitness equipment brand name has loomed ever larger: Rogue Fitness. I was there in 2017 when Rogue rolled out one of the craziest contraptions in recent history, the “Wheel of Pain,” a faux-medieval torture device the king-sized competitors in the annual strongman competition were required to push in a circle. The device was massive, a brutalist-inspired fitness equipment tour de force, an item so expensive, so awesome-looking and impractical, that no gym could contain it. Rogue, this monstrosity seemingly announced, wasn’t here to take part; they were here to take over.

And they have indeed. The fitness equipment industry saw impressive growth in 2020 due to pandemic-necessitated home gyms. Need to buy a ready-made CrossFit “box” that won’t be tied up by supply chain issues with Chinese factories? Rogue manufactures and sells those box setups and is back to shipping them in three to five days. Need a “Westside Barbell” licensed bench press, made in conjunction with one of the country’s best powerlifting gyms? Rogue makes and sells those in Columbus, Ohio, too.

Rogue’s real power play was in converting profits from physical assets into IP assets: They trademarked the term “Strongman” as it applied to their barbells, sleds, grip training tools, sandbags, and other equipment.

In other words, the company trademarked a term—strongman—that had been sitting there in the public domain for years, a term attached to hundreds of products made by dozens of companies, including some homemade and handmade specialty sets, all competing to be at the top of Google searches for terms like “strongman stone” and “strongman log.”

Let me disclose right away: Rogue makes good products. Most of my basement gym consists of Rogue equipment, from the Thompson Fat Pad bench to the trap bar to the squat rack. But the real strongman community, having watched as Rogue used its clout to squeeze out other producers of CrossFit and powerlifting equipment, have been sounding alarm bells.

Kalle Beck, who runs the popular “Starting Strongman” group on Facebook, reached out to Rogue CEO Bill Henniger. While conceding that Henninger could conceivably buy the entire sport of strongman as easily as he bought this heretofore-unclaimed trademark, Beck demanded to know what his intentions were. “I see the concern and don’t want it to be one,” Henniger wrote back. “Any threat [of using the trademark that way] was killed so that the community doesn’t have to worry about it.”

Calum Liptrot, co-founder of Rogue’s much smaller competitor Cerberus Fitness, isn’t persuaded by Henniger’s reassurance. “Rogue has already maxed out the value of a saturated market for CrossFit and powerlifting products,” he says. “And now, it could be argued that they’re trying to buy the entire sport of strongman, up to its showcase ‘World’s Strongest Man’ television event. Their trademark is limited to equipment, but there’s nothing to stop them from going ahead and taking the next steps, literally taking over the entire field. Imagine the NFL owned exclusively by Nike.”

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In other words, while we fitness enthusiasts were oohing and aahing over the “Wheel of Pain,” a Microsoft-sized monopoly was growing behind the scenes.

Rogue is reinvesting the proceeds of its fitness takeover by making beautifully shot Netflix documentaries about stone lifting and strongmen, sponsoring athletes like Game of Thrones star Hafthór Björnsson, and—perhaps more significantly for competing equipment companies—gobbling up design patents that allow them to go to court to stop the manufacture of heretofore run-of-the-mill products now deemed too similar to their own.

“This is a very big deal for consumers,” says economist and business analyst Ben Labe. “There’s a tremendous amount of consolidation in the fitness world, from Instagram influencers to equipment companies to supplement manufacturers. Fitness is more visible because of these stakeholders, who are relying on ‘extremely online’ marketing strategies to get their brand names out there, but the result is that nearly all the profits are flowing up to the 1 percent of brands in that market. And as these brands accumulate more money, they can do the economically rational thing by spending money to stifle choice and competition, which is what buying all these patents and all this IP is really about.”

“Meanwhile, what does the mainstream media do?” Labe continues. “Magazines like Popular Science write articles about the supposedly amazing science behind Rogue’s fairly standard deadlift bar, and nobody questions their shady business practices.”

In 2008, jump-rope champion Molly Metz got a firsthand taste of this cutthroat marketplace. She had patented her speed rope and became alarmed when she saw Rogue starting to advertise a seemingly equivalent speed rope via its social media and YouTube accounts. When confronted, Henniger said, “We are not in the business of violating patents and if there is a patent issue we will certainly address it.”

Metz, hardly a deep pocket like Rogue, responded by suing the company. That litigation remains ongoing. While it continues, Rogue has been aggressively attempting to enforce its own patents. “Rogue sent our U.S. distributor a cease-and-desist letter when we attempted to distribute our Throwing Sandbags,” says Liptrot. “They had obtained a ‘utility’ patent for a cylindrical sandbag from the U.S. Patent and Trademark Office, and our bags were also cylindrical, so that was that. Their patent likely wouldn’t have been granted in Europe, where we’re based, but a threatening letter from a lawyer was enough to shut down the sale of these items in the U.S. before we even launched them.”

“This is business 101. It’s a lot cheaper to lock down a relatively small market than to keep innovating products to try to expand it,” explains Labe. “I’m not saying Rogue isn’t making a quality product, because I’m not qualified to judge that. But I do think it’s smart, if not particularly ethical, to try to buy up the entire field. If you look at their first big expansion, they cut deals with all these CrossFit athletes. That sport was really growing in the early 2010s. Then they seemed to partner up with the handful of players in powerlifting. Now there’s the field of strongman competitors. They’ve got a chance to really consolidate their gains in the field.”

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Chris Duffin, a mechanical engineer who also happens to be a world record holder in various iterations of the squat and deadlift, says that Rogue’s preeminence pushed him and his Oregon-based company Kabuki Strength towards greater innovation and flexibility. Kabuki, like Rogue, saw increased business during the pandemic as sales of home gym equipment skyrocketed, more than offsetting purchases previously made by locked-down or closing public gyms. “Putting aside whether other manufacturers are making quality products—many are, especially if they’re handling the manufacturing domestically—there has not been much honest-to-goodness progression in the way barbells in particular are made, and that’s our mission,” Duffin tells me.

For Duffin, who came out of the engineering management world, the process has been a simple one, given his understanding of both design and IP: He invents new barbell variations, then patents and trademarks them. “The way to compete is by creating products that accomplish things the barbell, which has been fundamentally the same since the early 1900s, does not do,” he says. “That led to our creation of a new safety squat bar, our ‘transformer bar,’ with settings that could switch the lifter into either the front or the back squat positions, as opposed to the conventional safety squat bar, which forces everyone to perform a front squat. And our ‘Duffalo bar,’ the other core product we slowly built our company around, is properly cambered so that it sinks into the back of someone who has been performing the back squat on a conventional barbell and experiencing shoulder pain, as I had been.”

From these two products, as well as the first adjustable trap bar for deadlifting that allows lifters to employ different grips, Duffin built Kabuki from a company with $2 million in sales in 2017 to $20 million in 2020. The company is still a far cry from Rogue’s 600 employees and $160 million in annual revenue, but, more importantly to Duffin, they’re an active player in the game.  “Rogue has its core competency, manufacturing conventional equipment, and we have ours, which is carefully launching useful new products,” he says. “Find your mission, find the community you serve, and expand in that space. Rogue has made smart decisions within their very large lane.”

Liptrot concedes that Rogue has made some shrewd business moves, but he worries about its long-term effects on the sport. “I quit a good-paying IT job to help launch Cerberus,” he says. “My goal wasn’t to get rich. It was to provide gear that supports this community. Cerberus has helped sponsor athletes and donated equipment to strongman competitions, but I never foresaw a world of these enormous prizes for strongman victories. Strongman was a hobby; it wasn’t something where you eked out narrow wins over and over again in this kind of mercenary, professionalized way each year because it was your full-time job.”

“Now, though, to even get your lifting gear approved by a major powerlifting body, you’ve got to hand over hundreds of thousands of dollars. Multi-millionaire Mark Bell, whose Sling Shot brand dominates the powerlifting apparel space, can just step in and buy rules changes that allow folks to use his gears. Rogue is even richer and can simply buy entire sports if they’d like.”

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Longtime strongman competitor Vanessa Adams believes that Cerberus, at least in her opinion, sells the right stuff. “They make better equipment than Rogue at a better price point, and Rogue went after them when their sandbags were used to great effect in a competition,” she tells me. “It’s not a ‘Strongman’ sandbag unless Rogue sells it, even though people like me have been calling various types of equipment used in strongman competitions ‘strongman’ for our entire lives. These aren’t newly engineered products like that Kabuki ‘Duffalo’ bar. They’re just variations on things that anyone should have a reasonable claim to be able to make.”

Labe takes a long view of these market shifts. “Whenever some kind of fad goes mainstream, the initial flurry of excitement is followed by people commodifying the heck out of whatever products are created. What may have begun as an underground thing—some activity undertaken only by a few oddballs and outsiders—is suddenly mass-produced, effectively marketed and put in the hands of the many,” she says. “A couple key players carve up the market, and the rest of us wonder about what might have been.”

To Chris Duffin, who grew up homeless in the Oregon woods at the mercy of pot-growing hippie parents who moved frequently to stay one step ahead of the law, the threat is less concerning.  “I’ve worked with Rogue on distribution and can continue working with them,” he says. “If you’re the only company that can manufacture your specific products and have taken all the right steps to protect that manufacturing process, you’re in a privileged place. If you’re upset that you can’t make or sell a generic sandbag, devise a better one and then take steps to protect its production process and market it accordingly. This was never an innovative field, and there’s lots of room for more innovation.”

And so, to keep the economic “Wheel of Pain” turning in spite of Rogue’s seemingly immovable market-leading inertia, it must be propelled by fitness entrepreneurs who possess the innovative equipment designs and marketplace discipline to ensure it remains in motion.

Oliver Bateman is co-host of the ‘What’s Left?’ podcast.

This article was supported by the Ewing Marion Kauffman Foundation. The contents of this publication are solely the responsibility of the authors.

The post A Monopoly on Muscle appeared first on The American Conservative.

As reported by The American Conservative. Continue reading this article at The American Conservative

All news text, graphics, videos and multimedia content remain the copyrights of the credited original article publisher, in this case - The American Conservative

The Daily Reformer is an American conservative news aggregator and publisher with a mission to provide "the smart take on American conservative news.

Contact Information: amnon (at) thedailyreformer dot com