Yahoo! Gets Adobe in Its Corner

• Email
• Share
• Print

Yahoo! (Nasdaq: YHOO) evidently has decided that making a new ally is a good way to parry the threat from Google (Nasdaq: GOOG).

The company announced yesterday that it is joining forces with Adobe Systems (Nasdaq: ADBE) to add some new features to Adobe's highly popular Acrobat software used for reading portable document format files (PDFs). Under the pact, new versions of Acrobat will offer a toolbar that will provide access to Yahoo!'s search, pop-up blocking, and anti-spyware technologies. For Adobe, the team-up improves its software's usability. For Yahoo!, it's all about presence.

Adobe is used by more than 500 million people, according to TheNew York Times. That's a pretty huge customer base to which Yahoo! now has improved access. Whether Yahoo! will be able to convince many of them to accept the new toolbar is another question, however. The two companies promised that the toolbar will eventually incorporate the ability to convert Web content into the PDF format for offline use. This is a highly intriguing feature, but users may wait until it is actually available before taking much interest in the toolbar.

Nevertheless, the alliance improves Yahoo's positioning, and not a moment too soon. In its latest quarter, Google showed its capacity for stunning growth. What's more, Google is clearly bulking up for bigger things. From June to September, the firm increased its workforce by more than 16% to 2,668 employees. Rumors abound on Google's plans, including speculation that the company is working on its own Web browser.

The race for dominance is by no means settled, but Google clearly has solid momentum. In light of the heady competition, Yahoo! is wise to seek powerful friends.

Fool contributor Brian Gorman is a freelance writer in Chicago. He does not own shares of any companies mentioned in this article.