Competitors Join Forces

Adobe, Macromedia meld product lines.

Customers of Adobe Systems Inc. and of Macromedia Inc., longtime rivals that agreed to merge last week, are cautiously optimistic that the benefits of the $3.4 billion deal will outweigh any potential drawbacks and ultimately create a stronger company.

"I would characterize my feelings as a combination of excitement and uneasiness at the same time," said Stacy Young, a senior developer with Optimal Payments Inc., in Montreal. "My only concern is whether the acquisition will disturb the close relationship Macromedia has with the development community and longtime customers."

"I can only guess but Im thinking Adobe wants to jump-start their server-side offering to extend their workflow product offering, etc., [which is] also possibly another positive point."

Young is not alone in her concerns about the mergers effect on developers.

Macromedia user Darius Fattahipour, senior IT engineer for San Diego Countys Department of Child Support Services, said: "While ultimately I believe Adobes acquisition will be a success, if youre a developer, its going to mean some confusing times ahead as Adobe integrates Macromedias product line. These companies have many competing products. Personally, Im not usually a big fan of acquisitions when companies are direct competitors."

Roland Collins, chief technology officer at InvestEdge Inc., in Pittsburgh, said he sees little reason to worry that the merger spells the end of some Macromedia products. "I dont really share the paranoia that a lot of Macromedia diehards have been expressing," Collins said. "I cant really see Adobe doing away with many of Macromedias offerings, since Macromedia has worked hard over the years to put together a solid, profitable set of products."

In a news conference announcing the deal last week, Bruce Chizen, Adobes CEO, in San Jose, Calif., cited the "complementary functionality" of Adobes PDF and Macromedias Flash technology, both de facto standards in their spaces.

Analysts, meanwhile, say Adobe-Macromedia will be a major force. "I think the Adobe plus Macromedia forms a new wild card in some desktop- and graphics-related formats and standards. Both have great installed bases among desktops, and together theyll have much more influence in what happens with interoperable, cross-platform document, graphics and animation formations," said Gary Hein, an analyst with Burton Group Inc., in Midvale, Utah.

Chizen will continue as CEO, and Shantanu Narayen will remain president and chief operating officer. Meanwhile, Stephen Elop, president and CEO of Macromedia, of San Francisco, will join Adobe as president of worldwide field operations.