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Author
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Topic: Adobe and Macromedia announce merger...wha!?
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Bobby Henderson
"Ask me about Trajan."
Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001
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posted 04-18-2005 03:17 PM
Being a graphic artist, this news released today shocked me:
http://www.msnbc.msn.com/id/7543918/
quote:
Adobe to buy Macromedia for $3.4 billion
Deal seen spurring creation of new software
The Associated Press
Updated: 8:06 a.m. ET April 18, 2005
SAN JOSE, Calif. - Adobe Systems Inc., one of the world’s largest providers of document-design software, will acquire Macromedia Inc. in an all-stock transaction valued at approximately $3.4 billion, the companies announced Monday.
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Adobe’s software includes the popular Acrobat and Photoshop program. San Francisco-based Macromedia makes the Dreamweaver and Flash web-design software.
Combining the two businesses, the companies said, will allow them to create more powerful software programs that can be used across multiple operating systems, which should pave the way for expansion into new markets.
Under terms of the deal, approved by the companies’ boards of directors, Macromedia stockholders will receive 0.69 shares of Adobe common stock for every share of their Macromedia common stock. That will result in Macromedia stockholders owning about 18 percent of the combined company when the deal closes.
The transaction, contingent upon the approval of both companies’ stockholders, is expected to be complete by the fall. It also requires the approval of federal regulators.
“Customers are calling for integrated software solutions that enable them to create, manage and deliver a wide range of compelling content and applications — from documents and images to audio and video,” said Bruce Chizen, chief executive officer of Adobe.
Chizen will remain as chief executive of the combined company and Adobe’s Shantanu Narayenb will continue as president and chief operating officer. Macromedia CEO Stephen Elop will join Adobe as president of worldwide field operations.
The companies said they are in the midst of developing “integration plans” that will build on their similarities. They made no mention of layoffs.
Adobe employs 3,700 people in offices around the world. It reported revenues of $1.295 billion for fiscal 2003.
“While we anticipate the integration team will identify opportunities for cost savings by the time the acquisition closes, the primary motivation for the two companies’ joining is to continue to expand and grow our business into new markets,” Chizen said.
Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
I've been a registered user of a number of Adobe products since the early 1990s and have been buying Macromedia apps since 1996. There's a good bet some of the apps I use will be cannibalized in this deal. With how Adobe priced upgrades on the first Creative Studio suite, I don't expect to get much of any price break on upgrades for already owning numerous Adobe and Macromedia licenses.
There's little reason for Adobe to keep selling both GoLive and Dreamweaver for web page assembly. ImageReady and Fireworks are two more apps that pretty much do the same thing. Here's some guesses I have over what will happen (provided federal regulators don't prevent this deal from happening over anti-trust concerns --yeah, like they would do anything like that these days, lol).
Guess #1: GoLive will get cannibalized by Dreamweaver. GoLiveCS2 will be the last version we see, even if it turns out to be a big hit (I've already read glowing reviews about it). Perhaps a few GL features may get incorporated into "Adobe Dreamweaver." However, I think, at most, we'll see Dreamweaver add live integration with Photoshop, Illustrator and InDesign and that will be that. Dreamweaver is the more marketable brand.
Guess #2: Fireworks is dead. Sure, it may have a bit of a better brand name than ImageReady. But ImageReady trumps it by being so integrated with Photoshop. ImageReady may copy some Fireworks features it doesn't have (I can't really think of any other than perhaps a bit of a more efficient JPEG compression engine). It's either that or Photoshop will gobble up them both. With 64-bit operating systems being mainstream by then (with the gigantic amounts of RAM that can be installed) I can see Photoshop doing just that.
Guess #3: Freehand will be dead. Hell, it's already pretty much dead anyway. Macromedia screwed the pooch when it rushed out a buggy version of FH10 just for the bragging rights of "first OSX graphics app." Then it offered no patches to fix the problem. Many longtime FH users on the Mac platform defected to Illustrator 10 and AI-CS. Adobe Illustrator has been crusing since version 10, even taking the title from CorelDRAW for dominant vector drawing application on the Windows platform. The most I see Illustrator doing to accomodate FH users may be some decent file opening options. That's about it.
Guess #4: Flash may be added into both the Adobe Creative Suite and their Video Collection. It would be interesting to see how After Effects and Flash gain some operability between each other. Macromedia was working on some video authoring technology to incorporate in future versions of StudioMX. There's no telling how that will play into upgrades on Adobe's apps. But if that R&D can help PremierePro (or replace it entirely) that would be cool.
Guess #5: I think there's a strong chance applications like ColdFusion, Contribute and Captivate may be sold off to pay down debt. The same thing could even happen to Macromedia Director (gasp). I'm not sure how Adobe can incorporate Director into any of their bundle suites. Perhaps a Flash Professional/Director bundle?
Guess #6: This one's really more of a hope than guess. And that's Adobe ressurecting Fontographer. I've been angry at Macromedia for acquiring this once great application from Altsys only to do absolutely nothing in developing it. I have a copy of the one version they released as part of the Freehand Graphics Studio 7 package. That dates back to October of 1996. Dammit. I could see Adobe reviving it as part of their type selling business. Adobe was a major factor in developing OpenType. "Adobe Fontographer" could be a really nice tool to have alongside Illustrator.
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Bobby Henderson
"Ask me about Trajan."
Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001
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posted 04-19-2005 10:26 AM
On the video authoring front, I'm not holding out much hope that Adobe will doing anything more than have a basically functional video editing and DVD authoring suite. I could be wrong, but it seems like Adobe's development resources are much more concentrated elsewhere --arguably correctly so. With the acquisition of Macromedia and its titles, Adobe will be the undisputed titan of print and web-based creative development.
Perhaps using Photoshop, Illustrator and After Effects (and perhaps Flash and Director) as leveraging tools Adobe could develop a first class video creation and DVD authoring suite. However, given the details of Apple's Final Cut Studio 5 package, Adobe looks to be more behind than ever. In fact, version 2 of Apple's Motion app is appearing to be an even greater threat to After Effects -at least on the Mac platform. Add to that Apple's addition of SoundTrack Pro, a full featured audio editing app that can challenge Pro Tools.
If anyone is going to be giving Apple any kind of credible competition in the video editing and DVD authoring area, I would expect it to come from the merger of Avid and Pinnacle. Both companies have great, high end turnkey systems. They have a better chance at approaching things from the professional side than Adobe does in challenging on the "prosumer/hobbyist" end.
One thing is certain, the Windows market on video editing and DVD authoring is wide open. Apple isn't going to do anything there. There aren't any credible suites there in the "affordable" category (at least in the manner of what Apple has done). Adobe will have to try a LOT harder with their next video collection offering. The Avid/Pinnacle merger could upend Adobe's video authoring efforts. Or Adobe could get walloped out of nowhere by Discreet/Autodesk (who make everything from Studio3D Max to those high end FlintHD and Inferno video/film effects systems).
To be honest, I just hope Adobe keeps its eyes focused on the graphics app thing. Photoshop, Illustrator, InDesign and Acrobat are their tent-pole apps. That's to be followed closely by Dreamweaver and Flash. The video thing ranks down the list on priorities.
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