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"Octavius: Stir not until the signal.
Brutus: Words before blows: is it so, countrymen?
Octavius: Not that we love words better, as you do.
Brutus: Good words are better than bad strokes, Octavius."
-- From "Julius Caesar" by William Shakespeare, 1599
Much has been made of the way Apple (Nasdaq: AAPL ) and Adobe Systems (Nasdaq: ADBE ) are doing battle over the rights to put Adobe-backed software on Apple's mobile gadgets. The highly public fight is an endless source of entertainment for disinterested bystanders and Apple fans alike, but those on Adobe's side of the story would prefer good words over bad strokes.
On my signal, unleash hell!
Adobe just introduced Creative Suite 5 (CS5) -- a comprehensive package of software to perform creative work in the digital age. CS5 components like Photoshop, InDesign, and Illustrator have long set the standard for what a graphics editor, document design program, and other vital tools should look like, and this refresh has been hailed as possibly the most ambitious round of revisions in Adobe's history.
But Apple sprung a trap on Adobe by making a prime selling point of the Adobe Flash Professional instantly obsolete. Packager for iPhone can compile a Flash application into code that an Apple iPod, iPad, or iPhone understands, working around the famous prohibition of Flash software on these devices. When Palm (Nasdaq: PALM) worked around a restriction in the Apple iTunes music library to publish iTunes music to the Pre smartphone, Apple updated its software to render Palm's solution useless. This time, the black-turtleneck gang simply changed its App Store policies to deny publishing any workaround solutions built in nonapproved programming languages, such as Packager for iPhone.
Developers either love this restriction or hate it, largely depending on what programming tools they like to use. Adobe spokespeople have explained calmly that one feature does not a Creative Suite make, and it's no big deal. Lee Brimelow, a "Platform Evangelist" at Adobe, on the other hand, forgot to take his chill pill. He outlined Apple's policy change as "a frightening move" that hurts end-users and developers, and noted that Adobe would never retaliate by removing Apple support from its Creative Suite products.
Friends in high places
Spirits run high on both sides of this conflict, and some observers trace it all back to Adobe treating Apple as a second-class citizen 16 years ago to focus its efforts on Microsoft (Nasdaq: MSFT ) Windows support instead. Grudges are nothing new in Cupertino, of course.
None of this should matter much to Apple. The company has the tech clout to make others work around iPhone idiosyncrasies such as the lack of Flash support. (Go to YouTube with an Apple Safari browser and you get a recently implemented HTML5 version of the video streams instead of good old Flash.) Yep, YouTube serves up Apple-compatible HTML5 videos if you want 'em. Google (Nasdaq: GOOG ) clearly isn't above helping an old pal out, especially when millions of tragically hip Apple users can be counted on to click on heaps of YouTube's embedded ads -- if the site works for them.
For Adobe, the situation is more dire. When Apple takes a stiff-lipped stand like this, the company has the power to influence public perceptions, how consumers use technology, what content formats are viable, and which ones aren't. Ultimately, a thousand cuts can start killing the value of Adobe's prized Flash platform.
Quo vadis, Adobe?
Adobe is too big and diversified to die an untimely death from this uncouth treatment, of course. (Photoshop and friends do have rivals, but are still the gold standard for creative software in many fields.) However, Adobe paid a good $3.4 billion for Flash inventor Macromedia, and that buyout added little more than Flash and the DreamWeaver Web development package. Declare Flash worthless and that deal would resonate with echoes of how eBay never made anything out of the Skype chat-and-phone acquisition. Billion-dollar goodwill writedowns never look good.
So it's in Adobe's best interests to talk peace with Apple, but posturing on both sides makes that look impossible. Flash has become a cross-platform software platform that runs your code almost anywhere. Apple is just one player in that game with a small slice of the overall market share pie, but it's also a trendsetter with a hot finger on the pulse of consumer sentiment.
Even Oracle (Nasdaq: ORCL ) won't persuade Jobs to run Java applications on the iPhone, and Adobe's leverage is far smaller than Larry Ellison's. In the long run, Adobe will have to bite the writedown bullet and live or die by CS5 and its descendants alone.
You win, Apple. But you still can't be Brutus to Adobe's Caesar.