NetPulse, E-Zone, Xystos Merge

Three companies that enable health clubs to set up broadband and interactive terminals on exercise equipment announced that they will merge their networks and content offerings.

Products from Netpulse Communications, E-Zone Networks and Xystos Media Networks combine radio, television, Internet access and workout management software on touch-screen flat panel displays mounted on or near treadmill or aerobic exercise machines.

The new company, Netpulse E-Zone Media Networks, will be based in San Francisco and possess more than 14,000 kiosks and workout equipment terminals, in about 700 health and fitness facilities. Company officials say it also has an additional 20,000 terminals contracted for installation.

“Uniting the three companies gives Netpulse E-Zone Media Networks a broad and diverse range of revenue sources, a lower cost structure, and the improved access to capital that comes with being a market leader,” said Andrew Wiswell the new company’s chief executive officer and formerly a senior vice president at E-Zone.

The companies sell advertising space through menubar banners, interstitials and on the screensavers of idle machines. Advertisers can also sponsor content channels.

Netpulse E-Zone Media Networks says its screens attract an affluent, receptive demographic.

“The merger creates a powerful tool for advertisers and content providers who want to reach active-lifestyle consumers,” said the new entity’s co-executive chairman Robert McKenzie, former CEO of E-Zone. “The network offers the best of what advertisers are looking for: a captive audience, strong targeting and accountability, and a broad range of media opportunities.”

Some large brick and mortar clients have bought into the idea. Advertisers on the companies’ networks include Sony, American Express, Procter & Gamble and Toyota, as well as online plays like iVillage.

Additionally, the merged company will have partnerships with 20 of the top 25 health and fitness chains in North America, as well as deals with ad network and server 24/7 Media and satellite network provider Gilat.

Spokespeople for the merging companies said future expansion will include the health club chains in other countries.