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Saturday, April 23, 2005

Adobe + Macromedia + Firefox! + Others!! - New Block??

A friend persuaded me to look at the Adobe+Macromedia merger from a different perspective and pointed to the Knowledge@wharton article on the merger Some of the key points highlighted in the article and my comments can be found alongside and in the bottom:
- The new Adobe Systems will emerge with an array of products commonly used in publishing content in the print, web worlds and have essential elements to building web sites. Since these are sought to build into platforms to deliver web-based content, their combined efforts will bring them head-to-head with Microsoft.
- Macromedia needed size and scale and for Adobe, the deal can swing huge future growth opportunities. Seen from this perspective, there seems to be a strategic intent to the merger.
- Adobe has a broad product portfolio, but Macromedia provides a pathway to the future. Adobe has a strong publishing position, but that's being eaten away by the web. The PDF is a bridge from paper to the web that may not always be needed. Flash is in mobile phones and is the rich interface in Tivo boxes and airport kiosks.
-Mobile phone market was the biggest driver for this merger. There is an explosion of digital information and a variety of ways to access it. Both Macromedia and Adobe have good presence in this arena. Together they are stronger web content player as communications increasingly go wireless and technologies such as Flash and PDF are bundled together. The mobile phone market could represent billions of dollars in revenues for the new Adobe over the next decade and the big race is to become a standard. Mobile phones are becoming intelligent devices and content will need to be created for them & If Flash becomes a mobile phone standard, Adobe could make money the way Qualcomm does by licensing its technology to phone makers.
- Adobe Systems will be well positioned as the next generation networks are rolled out in the U.S. Both Adobe reader and Macromedia's Flash are embedded in NTT DoCoMo handsets. The combined mobile product suites may be more appealing for the additional wireless carriers and handset manufacturers.
- With two of the three major non-Microsoft platforms that are critical in web applications - Flash, PDF and Java coming together now, Adobe will increasingly bump into Microsoft and its Office products. Microsoft could develop products that compete with PDF and Flash and bundle them in with Longhorn.

My Take: Adobe has moved sometime back from the desktop vendor player to enteprise vendor.For sometime,Adobe LiveCycle product line is offered as a server based enteprise offering enabling enteprises to use it as a secure document format helping in the full lifecycle information management sans direct storage facility - capture, collabaration & compliance. The average enteprise generates 300,000 business-critical documents a month, and is said to be promptly losing track of about 25% of those. 70% of Acrobat seats are now sold to businesses through Adobe's licensing division, not the traditional shrink-wrapped boxes. Adobe recorded 17 mln downloads of Reader 7, which represents 40% faster uptake than recorded for Version 6.In its new form, Acrobat becomes the hub between people, processes and policies as they commit business-critical information to the PDF format. Adobe is making this standard interoperable and may try and repeat the enteprise strategy with Flash. Though there were concerns about the pricing, net-net, Adobe seems to have gained more strength to explore emerging future opportuniites.The mighty challenge will be maintaining momentum & volume traction in software bundles, licensing, channel conflicts and direct sales and if I may add interoperability issues, middleware and browser access(Flash & Acrobat together looks attractive to imagine) – in all these arenas – independent initiatives like firefox, novell, some macintosh third party software providers,other open standards etc are taking shape to challenge Microsoft presence(often as an extension to windows or as embedded within). An opportunity presents itself for these forces to come together and form a formidable alternative. For this to happen, as in any other situation – its not only technical capability - it would be the vision and the speed at which the execution happens that would matter a lot - afterall my blackberry device does not support flash or acrobat while I can use MS word & excel!!.

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
"All views expressed are my personal views are not related in any way to my employer"