Adobe 2002 Annual Report Download - page 35

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4
Professional segment replaced the former Cross-media Publishing segment, and now includes Adobe Illustrator and
Adobe Graphics Server (formerly called Adobe AlterCast). In addition, a newly named Digital Imaging and Video
segment replaced the former Graphics segment. Our ePaper business segment remains the same, including revenue
from our recently-acquired Accelio Corporation (“Accelio”) business (acquired in the second quarter of fiscal 2002).
Our OEM Postscript and Other segment remains the same.
For more information on our old and new segment reporting, please refer to Item 7, Management’s Discussion
and Analysis of Financial Condition and Results of Operations, and Note 17 of our Notes to Consolidated
Financial Statements.
Beginning in fiscal 2003, we categorize our products into the four principal business segments as
explained below.
Creative Professional
Creative Professional Market Opportunity
Since Adobe was founded in the early 1980’s, a core customer of the Company has been the creative
professional. Graphic designers, production artists, Web designers, technical writers, videographers, photographers,
and prepress professionals use and rely on Adobe’s solutions for professional publishing, Web design, business
document publishing, and printing visually rich information. Our software tools are used by creative professionals to
create much of the printed and on-line information people see and read every day, including newspapers, magazines,
Web sites, catalogs, advertisements, brochures, product documentation, technical manuals, books, eBooks, memos,
reports, and banners.
Since the global economic downturn began early in 2001, creative professionals have been under economic
duress. They derive their revenue mainly from marketing and ad spending in corporations. With a global reduction
in marketing spending, the businesses of creative professionals have suffered. Consequently, there has been a
decline in spending by creative professionals on software, a decline in growth of the number of creative
professionals, and for Adobe, a decline in revenue from the creative professional customer segment.
However, the Creative Professional market continues to evolve, with increased needs to derive greater
efficiency from the software they use, the need to streamline their publishing workflows, and the desire to repurpose
content across a variety of media.
Adobe’s brand and customer loyalty in this market continues to be strong. Existing customers purchase
upgrades and new units of our creative professional products because of the frequent use of the products in their
daily work. However, until an economic recovery occurs in the major countries in which we do business, we believe
that our creative professional business will continue to be challenging.
As part of our corporate strategy, we are increasing our focus on the creative professional customer. Thus, we
have established a new creative professional business unit that will focus solely on the needs of this customer. In
fiscal 2003, the creative professional business unit will focus on two key strategies: 1) increasing the number of
Adobe products they use and 2) enabling more efficient collaboration and workflow through improved product
integration and by offering a professional version of Acrobat to assist in digitizing their publishing workflow.
To accomplish these two strategies, Adobe plans to execute against a number of key imperatives. They include:
continue to provide best-of-class products; grow usage of Adobe products such as professional page layout and
illustration, introduce a new version of Adobe Acrobat which will have specific features creative professionals can
use to increase their productivity; and focus on the licensing of collections of Adobe software applications that
provide a more complete integrated solution for various types of creative professionals. In addition, the Company
plans to continue to focus on enhancing support for eXtensible Markup Language (“XML”) in its products, and to
enhance the use of Adobe Portable Document Format (“PDF”) creation and workflow capabilities in its products –
both of which we expect to result in fast, reliable multi-device output.
In fiscal 2002, Adobe responded to the needs of our customers by delivering several new releases of our
Creative Professional software applications. In the first quarter of fiscal 2002, we released new versions of Adobe