Adobe Gets App Happy

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Adobe ADBEOver the years, Adobe (NASDAQ:ADBE) has created powerful development tools, such as its Creative Suite CS5.5 desktop software, which includes notable applications like Photoshop, Dreamweaver and Illustrator.

Yet when it comes to tablets, Adobe has been a laggard. Then again, Apple’s (NASDAQ:APPL) iPad caught many other tech companies, such as Microsoft (NASDAQ:MSFT) and Intel (NASDAQ:INTC), by surprise.

But now it looks like Adobe is catching up. For instance, this week the company acquired PhoneGap, which develops next-generation mobile technologies. And it’s likely that more deals are on the way.

However, the bigger announcement was Adobe’s new suite of apps — called Touch Apps — for the iPad and Google (NASDAQ:GOOG) Android tablets. The main one is Photoshop Touch, which makes it easy to edit, transform and scale images. No doubt, by leveraging the tablet interface — whether with a person’s hand or stylus — it should be easier for designers to evolve their creations.

Adobe makes use of new technology that helps deal with soft edges and other tough spots on an image. There also are helpful apps to improve color selection, as well as integrate photos. And yes, designers can share their images via Facebook and other social media platforms.

Adobe plans to sell each app at a starting price of $9.99, which should be a nice high-margin revenue source. And the company hopes the apps eventually will help boost sales of new licenses for the Creative Suite.

However, the grander vision for Touch Apps is to be a part of the Adobe Creative Cloud. Think of this as an app store for sophisticated products that leverage the rich technology of Adobe and allow for features like file syncing across devices.

True, for a company the size of Adobe — which has a market cap of $11.5 billion — the Touch Apps are not likely to move the needle in a significant way. But the company needs to maintain its competitive edge against a growing market of cheaper products coming to market. By offering tablet apps, Adobe should be able to stay ahead of the curve — at least for now.

Tom Taulli is the author of “All About Short Selling” and “All About Commodities.” You can also find him at Twitter account @ttaulli. He does not own a position in any of the stocks named here.

Tom Taulli is the author of various books. They include Artificial Intelligence Basics and the Robotic Process Automation Handbook. His upcoming book is called Generative AI: How ChatGPT and other AI Tools Will Revolutionize Business.


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