Quick analysis of Adobe and Buzzword

You may have already heard about Adobe’s acquisition of Virtual Ubiquity, the company that makes Buzzword. Being an Adobe fan and shareholder, I am excited. Rick Treitman and his gang are a smart, experienced group, and the software is simply amazing.

That having been said, I have a number of concerns. Maybe concerns is too strong. Let’s put it this way. I have some hopes about how Adobe goes about this.

I hope they find a way to make Buzzword available freely to everyone instead of just trying to sell to corporations. There was a bank robber by the name of Willie Sutton, who when asked why he robbed banks, replied: “That’s where the money is.” In a sense, this is why companies try to sell software to large corporations.

The most likely scenario that I can imagine is that they try to put Buzzword together with Acrobat and their newly announced Share product into a sort of office suite that they sell at relatively low cost (~5k?) to corporations. Why do I worry about this?

  1. Online applications are a potentially disruptive technology, but only when combined with easy availability. Look at the inroads that Google docs has already made. That application looks like a toy compared with Buzzword (no offense to Sam and Steve and the rest of the Google docs gang). But if Buzzword becomes a behind-the-firewall application that only large enterprises purchase, it won’t get the momentum it needs to move forward.
  2. In the enterprise, a better product is not necessarily the most important thing, and Adobe is not yet a company that has a proven track record of selling to enterprises. That’s not to say that Adobe couldn’t get there someday, but it’s hard.
  3. I’m just speculating about pricing, but a mid-priced (5k?) product is a very difficult product to sell. It’s not expensive enough to warrant a salesforce, but it’s too expensive for people to try out and adopt virally.

In general, I am usually skeptical of freemium models, but in this case, I think it’s the right one. (free product + premium offerings + expensive software sales for enterprises).

I hope Adobe doesn’t stretch itself too thin by trying to do too many things. Let’s count the fundamental shifts that Adobe is trying to undergo, all at the same time:

  1. Become a platform company.
  2. Become a technology provider to the mobile industry.
  3. Become an enterprise software company.
  4. Become a company that delivers software as a service.

Any one of these is potentially transformative, and very difficult to achieve. Trying to do it all is very scary. Maybe Adobe will pull it off, but I would feel more comfortable if the company was trying to do fewer things.

I hope Adobe finds a way for the Virtual Ubiquity guys to continue working as if they were at a startup. Even when everyone is doing everything right, organizational dynamics tend to change when a smaller company is absorbed inside of a larger one. And this space right now is going to get so competitive that I would rather bet on a small startup than a large company. Or better yet, I hope they can harness the power of both.


So those are my hopes. Overall, I am very bullish. Buzzword is an amazing piece of software, and the Virtual Ubiquity team is outstanding. Adobe leadership is smart and determined. The space is undeniably exciting. I am 100% sure that in 10 years, the way that people use productivity software will have completely changed. So Adobe is getting into a very exciting game with a great product. There is a lot of competition out there, and Adobe has a number of challenges ahead. I hope they come out on top.

6 Responses to “Quick analysis of Adobe and Buzzword”

  1. Mike Potter

    Nice post, glad to see you’re still posting.

    I’d love your thoughts on monetization models of RIAs. I think the fremium model actually has a lot of potential on the web. In fact, we’re seeing an increase use of that these days: Gmail is free, but more storage costs you. Picnik is free, but some filters and effects are available to premium members only.

    I’ve talked to a few people here and they’re thinking that advertising is the way to go with this app (not people who would be making that decision, thankfully.) Analyze the content, and display relevant ads beside it. I don’t buy it: I don’t want ads based on the content of my docs, and in many cases you couldn’t find a relevant ad for them anyways (my status report would be a good example.). In my mind, Yahoo has the potential here for taking the online ad lead, they’ve got the best ad system based on user behaviour. But, who wants to see ads based on their previous behaviour, sounds a bit too big brother for me.

    So, I do believe that the freemium model will eventually lead the way online – the free version gets users, and the power users pay for everyone else to keep using it.


    P.S. I don’t know how you connected Buzzword and the enterprise – I haven’t thought of it as an enterprise play. Office is too hard to topple there IMHO.

  2. Andrew Shebanow

    Buzzword will still be free to all comers. We intend to add additional features over time as premium services.

  3. Sho

    Great news!

  4. Michal Migurski

    So … what the hell is Thermo? It might be best for Adobe to chill the hell out and stop releasing products that step on each other’s toes like this. I’m finally beginning to understand what they’ve done to Flash in splitting Flex Builder off, and the company is still coming fast & furious with hot! new! frameworks! for making things! easier! for designers!

  5. Sho

    Wow mike… Not happy?

    Thermo is not a new framework. It’s a design tool for RIAs, and it uses the same flex frameworks that flexbuilder does (albeit a later version )

    It’s the thing I spent most of my time working on until I recently quit adobe. I’d be glad to have lunch with you sometime to shoot the sh@t about it if you’re interested. (lunch offer only valid to folks like mike who i know from way back :-)

  6. Michal Migurski

    No unhappy, just totally baffled by Adobe’s fragmentation of its product line since the Macromedia acquisition. Flash is our bread & butter, yet it feels out-of-hand. Also, now a little embarrassed to have gotten all OMGWTFThermo not knowing you were on the team. =)

    Would love to meet up sometime – will continue via e-mail…

Leave a Reply