Adobe 2010 Annual Report Download - page 31

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companies including Corel. New image editing applications for mobile devices and tablets with features which compete with
our professional products are also emerging as adoption of these devices grows. Our Adobe Photoshop products compete
favorably due to high customer awareness of the Photoshop brand in digital imaging, the positive recommendations for our
Photoshop product by market influencers, the features and technical capabilities of the product and our ability to leverage
core features from our other established products.
Our other digital imaging and video editing offerings, including Adobe Photoshop Elements and Adobe Premiere
Elements, are subject to intense competition, including customer price sensitivity, competitor brand awareness and
competitor strength in OEM bundling and retail distribution. We face direct and indirect competition in the consumer digital
imaging market from a number of companies that market software which competes with ours, including ACD Systems, AI
Soft (Japan), Apple, ArcSoft, Corel, i4 (Japan), Google, Kodak, Nova Development, Magix, Microsoft, Photodex
Corporation, Sonic, Pinnacle and Sony.
In addition, we face competition from device, hardware and camera manufacturers such as Apple, Canon, Dell, Hewlett-
Packard, Nikon, Phase One, Sony and others as they try to differentiate their offerings by bundling, for free, their own digital
imaging software, or those of our competitors. Similarly, we face potential competition from operating system manufacturers
such as Apple with their iPhoto product and Microsoft as they integrate or offer hobbyist-level digital imaging and image
management features with their operating systems. We also face potential competition from smartphone and tablet
manufacturers that integrate imaging and video software into their devices to work with cameras that come as part of their
smartphone and tablet offerings. In addition, new social networking platforms such as Facebook are becoming a direct means
to post, edit and share images—bypassing the step of using image editing and sharing software.
Competition is also emerging with a new category of imaging and video applications on tablet and smartphone
platforms. Existing as well as new competitors are extending their products and feature sets to platforms such as Apple’ s iPad
and potentially other tablet devices. Similarly, new cloud-based SaaS offerings continue to emerge which offer image editing
and video-editing capabilities, as well as social and sharing features. In addition to competing with our own mobile
applications such as Photoshop Express, our Lightroom product and our Elements hobbyist products, these products could
start to encroach upon the feature sets of our professional tools.
Applications for digital video editing, motion graphics, special effects, audio creation and DVD authoring face
increasing competition as video professionals and hobbyists migrate towards the use of digital camcorders and digital video
production on their computers, and DVD systems and online video for rich media playback. Our Adobe After Effects, Adobe
Audition, Adobe Encore, Adobe Premiere Pro and Adobe Soundbooth software products, as well as the Adobe Production
Premium suite which contains these products, face competition from companies such as Apple, Avid, Canopus, Sonic and
Sony.
Our Adobe Premiere Elements software product which is targeted for use by hobbyists, faces competition from
companies such as Apple, ArcSoft, Avid, Broderbund, Corel, Magix, Microsoft and Sony—as well as video editing
capabilities found in operating systems, hosted SaaS solutions, video editing solutions bundled by video camcorder
manufacturers with their hardware offerings, and video editing solutions bundled onto smartphones. Similarly, we face
potential competition from operating system manufacturers such as Apple with their iMovie and iDVD products and
Microsoft with their Windows Movie Maker product as they integrate or offer hobbyist-level digital imaging and image
management features with their operating systems.
We believe we compete favorably against other digital imaging, digital video and consumer-focused image management
software applications with our Adobe Photoshop Elements and Adobe Premiere Elements products due to strong consumer
awareness of our brand in digital imaging and digital video, our relationships with significant OEMs, positive
recommendations for our products by market influencers, our increased focus on the retail software channel and strong
feature sets.
Adobe After Effects is a leader in professional compositing and visual effects due to its strong feature set and its
integration with our other products that helps create a broad video editing platform for our customers. In professional digital
video editing, we are an industry leader with Adobe Premiere Pro and compete favorably due to our strong feature set, our
OEM relationships and the integration with our other products to create a broad digital video publishing platform for our
customers.
Digital Enterprise Solutions
With our Adobe Acrobat business, we continue to face competition from Microsoft. Their widely used Office product
offers a feature to save Microsoft Office documents as PDF documents, which competes with Adobe Acrobat. They also