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The Adobe/Macromedia Merger: More Than A Monopoly?

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Recently, those that follow the Internet technologies/graphics and multimedia industry were greeted with some rather interesting news: Adobe and Macromedia have agreed to a deal which allows Adobe to purchase Macromedia for an estimated 3.4 billion dollars (USD).

Adobe Devours Macromedia
Adobe Acquires Macromedia

As one can imagine, an acquisition of this magnitude, especially with software companies that generate such a fierce loyalty amongst their followers, was greeted with a broad reaction. There are many who support Adobe’s purchase, while others are quite disappointed with the news. However, when speaking of the upcoming purchase, one question has continually bubbled to the surface:

What is Adobe going to do with these properties besides creating a graphic/multimedia software monopoly?

Answers to questions like this will likely come in terms of speculation and reading between the lines. There are a number of perspectives to consider, and the best place to initiate a search like this is going directly the horse’s mouth, followed by working your way down to the software users.

First and foremost, it is important to remember that deal has not been approved. It still requires the approval of company stockholders as well as government regulators. Because the deal is awaiting acceptance, employees for each company are hesitant to go into details concerning upcoming decisions about current Macromedia software packages.

However, Mike Chambers, a product manager at Macromedia, shared some details about upcoming Macromedia products, as well as day-to-day operations, which he says will continue on as before:

We are still working on 8ball, Maelstrom and everything else we have been working on. We are still planning to ship sometime in the second half of this year. We are still committed to Flash as a development platform (probably more than ever now). We are still committed to our server products, such as ColdFusion (7 has been incredibly successful) and Flex.

Adobe, on the other hand, provides the expected forward thinking/corporate speak responses in an FAQ pdf discussing why they are attempting to purchase Macromedia. Contained within Adobe’s manifesto are their “goals” with respect to the impending deal:

What is the mission of the combined company?
Adobe’s mission remains the same – to help people and businesses communicate better. With the acquisition of Macromedia, Adobe strengthens its mission through the combination of leading-edge development, authoring and collaboration tools – and the complementary functionality of PDF and Flash. Going forward, the combined company has the opportunity to define a robust technology platform that delivers compelling, rich content across a wide range of devices and operating systems.

While this statement is quite flowery, it does contain information that can help draw conclusions about the reasons why. Adobe seems to be focusing on Flash, while Chambers, who mentions something about Flash in his blog, supports this:

I strongly believe in the potential of Flash as a cross-platform solution for deploying rich content and applications (I can’t stress the cross-platform part of that enough). Together, the combined company will have the resources on our own to make the platform successful on a larger scale.

He goes on to say that Adobe’s increased revenue and presence will give Flash a stronger support system than the one provided by Macromedia. Chambers also mentions the fact that Adobe has more resources to support Flash. He believes Adobe’s support will allow Flash to “play a significant role as the next generation application / content platform.”

Although both companies are hesitant to reveal upcoming changes, one thing that continues to be mentioned is how this deal will benefit Flash, which leads to another question:

Did Adobe pay $3.4 billion for a Flash plug-in?

Another area of interest concerns the various reactions found in web developer and other Internet technology-related forums. This is where talk of an Adobe monopoly was the loudest. Many posters see the deal as Adobe consuming their competition, while hurting overall developer software innovation.

On the Cre8asite forums, poster FrankElly offers thoughts which seem to sum up the fears of those who may be against this upcoming merger:

IMHO, very, very bad news.

Macromedia is a smart, dynamic company brimming with people who understand their customers, understand the technology, and deliver top-notch products that really do what you need them to do. I buy their products because I truly like them. (Dreamweaver, Flash, Director back in the good old days.)

Adobe is a conservative, plodding company that too often puts company priorities above customer satisfaction. (Small example: an absolutely customer-hostile upgrade experience. And $150 for a .0x release of Photoshop.) I buy their products only because I have to have them. (Photoshop, Acrobat)

I fear for what this means for the Macromedia product line. A company like Adobe can suck all of the innovation out of a product line and drive out the vitality of its management.

Of course, a strong dislike and/or support for a company and their products can produce such a reaction. If you were to poll those who prefer Adobe, I’m sure their response would be more optimistic and supportive. However, a large majority of the responses mimic what Frank offered: they would rather not see Macromedia go to Adobe.

Many of these comments use words like “bloated,” “old,” “not customer friendly,” and “copying Microsoft’s business plan” in describing Adobe.

On the other hand, words like “innovative,” “attentive to customer needs,” “dynamic and young” are used to describe Macromedia. Perhaps the Macromedia purchase will give Adobe a shot of vitality.

If not, that’s one hellavu price to pay for a Flash plug-in.

Adobe expects the Macromedia transaction to be closed by the fourth quarter of 2005.

What are your thoughts about the Adobe/Macromedia purchase? Discuss at WebProWorld.

Chris Richardson is a search engine writer and editor for WebProNews. Visit WebProNews for the latest search news.

The Adobe/Macromedia Merger: More Than A Monopoly?


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  • krane

    of coarse, of time, comes the monopoly. Adobe has the best stuff there is no comparison; but should there be when its the industry standard and always have been, as you know they aquired all the rest of macromedia for their own and made it for compatability. Personally, Ive always been down for it. There is no comparison; i.e. as an example as photoshop, and that is what is up, best thing in the world. One day maybe someone will come and create something as good or better. but as far as adobe; I love that shit.
    who could come to compare. Unless you know of an interface with everything you could EVER want/need to create what you want.
    bse.
    p.s
    macs as well.
    p.c.’s are a thing of the past.
    kransume@hotmail.com

  • http://www.pdxhousepainting.com/ Portland House Painting

    Looking back on the merger, it seems that the negatives have faded into the past.  The value of their products has risen, and I’m satisfied.

  • Stephen D

     I think given the way Adobe price their products, there is with out a doubt a monopoly in play here. What other company do you know that prices their products so highly for software with such a large market? Microsoft don’t even dare to charge so much!

    • Someone.

      I know. adobe photoshop CS4 is like, 1000 dollars. and windows vista ultimate is like oh…. 319 dollars… like its less for an os than a design program! geez….. i don’t wanna know how much an adobe os would be if adobe released that….. 10,000 dollars??

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