Business Model Will Focus on Subscriptions, Tablets, Creative Cloud Initiative

Adobe announced yesterday that it is abandoning development of Flash on mobile devices, essentially ceding the standards war over content for mobile platforms to HTML5. At the same time, the company announced a restructuring that will eliminate 750 jobs, mostly in North America and Europe.
That does not mean Flash goes away any time soon on the desktop, even as the company accelerates its work on HTML5. “We are already working on Flash Player 12 and a new round of exciting features,” wrote Adobe VP and General Manager of Interactive Development Danny Winokur in a blog entry posted at blogs.adobe.com this morning. “We will continue to leverage our experience with Flash to accelerate our work with the W3C and WebKit to bring similar capabilities to HTML5 as quickly as possible, just as we have done with CSS Shaders. And we will design new features in Flash for a smooth transition to HTML5 as the standards evolve so developers can confidently invest knowing their skills will continue to be leveraged.”

At an analysts’ meeting today in New York, the company is explaining a new business plan emphasizing the software-as-a-service model and the company’s new Creative Cloud initiative, including the recently announced Creative Touch apps for tablets. [Previously.] The company is citing stats indicating that 77 percent of creative professionals want to create content on tablets.

Adobe also says its new CS5.5 subscription program (which prices different versions of the suite at between $65 and $129 per month) is bringing new converts into the fold, claiming that 38 percent of new subscribers have not purchased Adobe products in the past, and that 76 percent of existing users say they would not have upgraded without the subscription option. In fact, the company says it expects to receive about one-third of its revenue from creative products in the form of subscriptions within three years.

For more information: www.adobe.com.