Adobe Systems Greatest Challenge: to Continue Growing
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This information technology company, Adobe Systems Inc (NASDAQ: ADBE), provides creative products and publishing tools for graphics designers, artists, web designers, and advertisers as well as by publishers and professionals in nearly every industry. It recently peaked and had been slowly building on a bearish pattern as investors wonder how the company will continue to grow into the future.
The latest “jewel” the company has developed is a product line called Creative Suite (CS). The software allows one to create online and print things like websites, newspapers, magazines, brochures, and more. Its products have dominated the market and “product cycle” has driven Adobe’s stock pricing. So many people use the products, that nearly half of the customers are interested in updating when a new product comes out like CS-^ for example.
But how long will these last? Google (NASDAQ: GOOG) offers several Adobe-type products for free through its Google Apps and Docs platform. An example would be Google’s Swiffy which may mirror Adobe Lab’s Wallaby. They both convert Flash to HTML5. And have you seen an adobe product on an Apple product? Neither iPhones nor iPads have it and at the same time PC sales are slowing down.
Adobe’s greatest challenge is to communicate with concerned investors that it can stay relevant with its dominant brand like it used to. In order for this to happen, the company has to show investors that it can continue to grow market share. This is what investors want to see. Adobe is still dominant in its core popular Creative Suite of programs - titles which include Photoshop, Pagemaker as well as the web design software of choice for developers, Dreamweaver. And of course who can forget Acrobat Reader and its flagship Flash plug-in.
Right now, the future for Adobe Systems is in CS6. It will introduce new features that most design professionals will embrace as critical, including support for HTML5, a language for structuring content on the Internet. The new software will include tools that facilitate development of mobile applications, as well as tools designed for tablet computers. CS6's "Creative Cloud" will allow users to subscribe to CS6 as a software-and-service bundle, reducing the upfront cost of buying the product. This is a good move for the company. Users will have access to both Mac and Windows versions of all software, providing the option of a subscription model for the company's highly popular tools.
Adobe has a creative development group—but growth in any aspect of its business won't be as easy as just focusing on which areas it wants to grow - particularly in its digital marketing as competition in this space is already crowded. The company has a challenging future ahead of itself.
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