February 22, 2006
Source: Knowledge @ Wharton
In 1985, Adobe Systems had one major product — a printer controller built around Adobe’s PostScript imaging language marketed to printer manufacturers. Now, having completed its acquisition of Macromedia on December 3, 2005, Adobe is the fifth largest software company in the world.
Adobe currently controls two of the dominant formats for electronic content — the Adobe Acrobat PDF format for electronic documents and the Flash SWF format for interactive web content. Adobe plans to leverage these and other core assets to provide an “engagement platform” that it hopes will provide the foundation for the next generation of software and application development — both on the web and on users’ desktops.
Adobe’s vision is grand. CEO Bruce Chizen hopes that Adobe will provide the interface for any device with a screen — “from a refrigerator to an automobile to a video game to a computer to a mobile phone.” Such ambitions put Adobe squarely in the sights of Microsoft, which currently dominates desktop software development.
And Microsoft is moving quickly to counter Adobe’s moves. It has announced a number of products poised to compete directly with Adobe’s core products. Microsoft’s strategy includes, among other initiatives, positioning elements of the forthcoming Windows Presentation Foundation to compete with Adobe’s Acrobat and Flash applications, and potentially undercutting Adobe’s profitable Acrobat product line by including PDF creation in the next version of Microsoft Office.
Knowledge@Wharton recently met with Bruce Chizen in his San Jose, Calif., office, where he spoke about the details of the Macromedia acquisition, Adobe’s plans for integrating Macromedia’s technology to develop the next-generation application platform, and his views on the challenges presented by Microsoft. An edited version of that conversation follows.