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October 30, 2006
Bigger pies
Bigger pies: Liz Gannes at GigaOM wonders about the Adobe business model, where the company doesn't make money from download-and-play video sites, has started a $100M venture fund for Apollo projects, has acquired specialized talent for the next generation of video work, and so on. Looking at the Flex 2 model shows one strategy. Adobe realizes ROI through the optional Flex Builder design tool, the optional Flex Data Services for client connectivity, training materials, feature support in other tools like Fireworks, and so on. Such work is always under pressure from copycat commodification, so the company needs to keep expanding the wave and just riding it faster than other groups can. The faster Adobe can bring startling technologies into acceptance, then the wider a window the company has to realize returns on that work. I'm not responsible for bottomline calculations myself, but that "rising tide lifts all boats" approach is what I'm seeing from business managers throughout the company these days. (Video tools are performing awesomely, by the way... there was a turnaround a version or two back.)
Posted by JohnDowdell at October 30, 2006 07:17 AM
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More on this approach:
The $100 million VC commitment is one of Adobe's vehicles for building a broader market around its entire development platform, according to Pam Deziel, director of product marketing for Adobe's platform business.
"We've had the VC fund for a number of years, but this is a shift in focus and engagement. What we're really talking about here is becoming more active in building our own ecosystem," Deziel said. "This is [for] funding entities that we believe are going to help us drive and proliferate the Adobe platform."
Posted by: John Dowdell at October 30, 2006 07:34 AM
Is there an address for the VC group to offer applications for funding consideration?
[jd sez: I was wondering about that too... I hadn't seen contact info on judging criteria published at the keynote. The info may be out there already, but this is one of the items I'll be pursuing this week. More news soon.]
Posted by: Dave_Matthews at October 30, 2006 01:11 PM