Adobe 2010 Annual Report Download - page 5

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o Advertisers face an ever-shifting media landscape. Traditional media are giving way to the emergence of new digital
channels such as mobile devices and social networks. Customers have greater choice in where they go for their
preferred brands, making it harder to keep audiences engaged. Successful advertising increasingly requires
compelling content and greater focus on data and analytics than ever before in order to optimize advertising for
improved targeting and higher returns.
As technology continues to change and improve, the market dynamics for these creative professionals continue to
evolve. Due to the constantly changing ways in which people choose to receive information, creative professionals look to
their software tools and services as a means to make their information impactful and to repurpose content across a variety of
media, applications and systems. They desire greater efficiency from the software they use to streamline their publishing and
content creation workflows and to effectively manage their assets. They also look for new and innovative ways to deliver
their content and information to hand-held devices such as smartphones, tablets and consumer electronic devices.
Creative professional customers license upgrades and new versions of our Creative and Interactive Solutions products
due to the high degree of innovative new features and significant productivity gained through their use. They also frequently
purchase license upgrades and new versions of these products when they buy new computers, or migrate to new or updated
operating systems.
In addition, knowledge workers in enterprises and government, educators and students in schools and universities, and
hobbyists at home license our creative products. Knowledge workers desire professional-quality products to accomplish tasks
such as creating visually-rich sales presentations, engineering or architectural proposals, real estate flyers and school
yearbooks. Educators utilize our solutions to educate future creative professionals, as well as create their course content and
online eLearning-based lessons. Hobbyists use our tools to create distinctive online communications, community newsletters,
blogs and Websites for family, friends or community organizations.
With the increasing use of the Web as a means for marketing, advertising and commerce, we believe a key driver of our
Creative and Interactive Solutions business will also be the growing amount of Website content created by our customers to
deliver impactful and compelling Web-based experiences for their constituents across multiple screens, including PCs,
mobile devices such as smartphones and tablets, and Internet-connected living room electronics such as televisions. We also
believe those who manage Websites will want to utilize Web analytic data and other Web usage metrics to optimize their
Websites and content to improve the overall experience of their sites.
To address these trends and the workflow implications, our Creative and Interactive Solutions business unit also focuses
on the development, marketing and licensing of our Adobe Flash technologies, as well as our support and development
efforts for other Web technologies including HTML. The broad reach and rapid adoption of the newest versions of our Flash
technologies allows us to rapidly innovate with our designer, developer and enterprise software which utilize these
technologies—enabling our customers to deliver new and more engaging experiences to their constituents with the widest
range of media that leverages the latest advancements in operating systems, platforms, devices and rich media technologies.
Our support for HTML and other Web standards enables these technologies to also be broadly adopted through innovations
in our tools, and used to create rich, engaging Web experiences.
Creative and Interactive Solutions Business Summary
Our Creative Suite 4 (“CS4”) family of products, which first shipped in fiscal 2008, incorporated Adobe technologies
used by creative professionals into six Creative Suite editions and thirteen individual creative products, providing offerings
for the various creative disciplines our customers desire. Entering fiscal 2010, our overall creative business was exiting a year
that was adversely affected by the global economic recession and the weak general macro-economic environment. This
caused overall revenue for CS4 to be lower than revenue achieved with the prior version for a comparable period of time
since release. Despite this economy-driven weakness, we maintained our focus on driving adoption of our creative products
entering 2010—particularly with large media companies and enterprise customers. With our execution, and as the general
economy improved in early 2010, licensing of our CS4 products remained stable in the first five months of fiscal 2010.
In May of 2010, we delivered Creative Suite 5 (“CS5”), the newest release of our creative toolset. CS5 provides more
than 250 new and enhanced features, significant performance improvements, new integration with Omniture measurement
and optimization services (or software services), and new workflow capabilities. These feature sets enable users to create and
deliver their content and applications across the broadest range of media and formats.
The launch of CS5 included the introduction of a new product called Adobe Flash Catalyst, which is a professional
interaction design tool for creative professionals who want to create expressive interfaces and interactive content without
writing code. The new CS5 release was also the first version of Creative Suite to integrate with new Adobe CS Live online