Footnotes / references Financials as of November 29, 2024[update].[1]
Adobe Inc. (/əˈdoʊbi/ⓘə-DOH-bee), formerlyAdobe Systems Incorporated, is an Americancomputer software company based inSan Jose, California. It offers a wide range of programs from web design tools, photo manipulation and vector creation, through to video/audio editing, mobile app development, print layout and animation software.
It has historically specialized in software for the creation and publication of a wide range of content, including graphics, photography, illustration, animation, multimedia/video, motion pictures, and print. Its flagship products includeAdobe Photoshop image editing software;Adobe Illustrator vector-based illustration software; AdobeAcrobat Reader and thePortable Document Format (PDF); and a host of tools primarily for audio-visual content creation, editing and publishing. Adobe offered a bundled solution of its products namedAdobe Creative Suite, which evolved into a subscription-based offering namedAdobe Creative Cloud.[2] The company also expanded into digital marketing software and in 2021 was considered one of the top global leaders in Customer Experience Management (CXM).[3]
As of 2022,[update] Adobe has more than 26,000 employees worldwide.[4] Adobe also has major development operations in the United States inNewton,[6]New York City,Arden Hills,Lehi,Seattle,Austin andSan Francisco. It also has major development operations inNoida andBangalore in India.[7] The company has long been the dominant tech firm in design and creative software,[8][9] despite attracting criticism for its policies and practices particularly around Adobe Creative Cloud's switch to subscription only pricing and its early termination fees for its most promoted Creative Cloud plan, the latter of which attracted a joint civil lawsuit from theUS Federal Trade Commission and theU.S. Department of Justice in 2024.[10]
The company was started in John Warnock's garage.[11] The name of the company, Adobe, comes fromAdobe Creek inLos Altos, California, a stream which ran behind Warnock's house.[4] That creek is named because ofthe type of clay found there (Adobe being a Spanish word forMudbrick). Adobe's corporate logo features a stylized "A" and was designed by graphic designer Marva Warnock, John Warnock's wife.[12]Steve Jobs attempted to buy the company for $5 million[13] in 1982, but Warnock and Geschke refused. Their investors urged them to work something out with Jobs, so they agreed to sell him shares worth 19 percent of the company. Jobs paid a five-times multiple of their company's valuation at the time, plus a five-year license fee for PostScript, in advance. The purchase and advance made Adobe the first company in the history of Silicon Valley to become profitable in its first year.[14]
Warnock and Geschke considered various business options including a copy-service business and a turnkey system for office printing. Then they chose to focus on developing specialized printing software and created the Adobe PostScript page description language.[15]
PostScript was the first international standard for computer printing as it included algorithms describing the letter-forms of many languages. Adobe added kanji printer products in 1988.[16] Warnock and Geschke were also able to bolster the credibility of PostScript by connecting with a typesetting manufacturer. They weren't able to work with Compugraphic, but then worked with Linotype to license the Helvetica and Times Roman fonts (through the Linotron 100).[17] By 1987, PostScript had become the industry-standard printer language with more than 400 third-party software programs and licensing agreements with 19 printer companies.[15]
Adobe's first products afterPostScript weredigital fonts which they released in a proprietary format calledType 1, worked on byBill Paxton after he left Stanford. Apple subsequently developed a competing standard,TrueType, which provided full scalability and precise control of thepixel pattern created by the font's outlines, and licensed it toMicrosoft.
Starting in the mid-1980s, Adobe entered the consumer software market, starting withAdobe Illustrator, avector-based drawing program for theApple Macintosh. Illustrator, which grew out of the firm's in-house font-development software, helped popularize PostScript-enabled laser printers.
In 1993, Adobe introduced thePortable Document Format, commonly shortened to the initialism PDF, and itsAdobe Acrobat and Reader software. Warnock originally developed the PDF under a code name, "The Camelot Project", using PostScript technology to create a widely available digital document format, able to display text, raster graphics, vector graphics, and fonts. Adobe kept the PDF as a proprietary file format from its introduction until 2008, when the PDF became anISO international standard under ISO numberISO 32000-1:2008, though the PDF file format was free for viewers since its introduction.[23][24]
With its acquisition of Aldus, in addition to gaining PageMaker and After Effects, Adobe gained control over theTIFF file format for images.[25]
Creative Suite and the Macromedia acquisition (2000–2009)
The 2000s saw various developments for the company. Its first notable acquisition in the decade was in 2002, when Adobe acquired Canadian company Accelio, also known asJetForm.[26][27] In May 2003, Adobe purchased audio editing and multitrack recording software Cool Edit Pro from Syntrillium Software for $16.5 million,[28] as well as a largeloop library called "Loopology". Adobe then renamed Cool Edit Pro toAdobe Audition. It was in 2003 that the company introduced the first version ofAdobe Creative Suite, bundling its creative software into a single package. The first version of Creative Suite introduced InDesign (the successor to PageMaker), Illustrator, Photoshop, ImageReady and InCopy, with the 2005 second edition of Creative Suite including an updated version of Adobe Acrobat, Premiere Pro, GoLive, the file managerAdobe Bridge, andAdobe Dreamweaver, the latter of which was acquired from a $3.4 billion acquisition ofMacromedia, most notably.[29][30]
By April 2008, Adobe releasedAdobe Media Player.[32][33] On April 27, Adobe discontinued the development and sales of its olderHTML/web development software,GoLive, in favor ofDreamweaver. Adobe offered a discount on Dreamweaver for GoLive users and supports those who still use GoLive with online tutorials and migration assistance. On June 1, Adobe launchedAcrobat.com, a series ofweb applications geared for collaborative work.[34] Creative Suite 4, which includes Design, Web, Production Premium, and Master Collection came out in October 2008 in six configurations at prices from about US$1,700 to $2,500[35] or by individual application.[36] The Windows version of Photoshop includes 64-bit processing.[36]
On December 3, 2008, Adobe laid off 600 of its employees (8% of the worldwide staff) citing theweak economic environment.[37] On September 15, 2009, Adobe Systems announced that it would acquire online marketing and web analytics companyOmniture for $1.8 billion.[38][39][40] The deal was completed on October 23, 2009.[41] Former Omniture products were integrated into theAdobe Marketing Cloud.[42] On November 10, 2009, the company laid off a further 680 employees.[43][44]
End of Flash, security breach, and employee compensation class action (2010–2014)
Adobe's 2010 was marked by continuing arguments with Apple over the latter's non-support for Adobe Flash on itsiPhone,iPad and other products.[45] Former Apple CEO Steve Jobs claimed that Flash was not reliable or secure enough, while Adobe executives have argued that Apple wishes to maintain control over the iOS platform. In April 2010, Steve Jobs published a post titledThoughts on Flash where he outlined his thoughts onFlash and the rise ofHTML5.[46]In July 2010, Adobe bought Day Software[47] integrating their line of CQ Products: WCM,[48] DAM,[49] SOCO,[50] and Mobile[51]
In January 2011, Adobe acquired DemDex, Inc. with the intent of adding DemDex's audience-optimization software to its online marketing suite.[52] At Photoshop World 2011, Adobe unveiled a new mobile photo service.[53] Carousel was a new application for iPhone, iPad, andMac that used Photoshop Lightroom technology to allow users to adjust and fine-tune images on all platforms.[54] Carousel also allowed users to automatically sync, share and browse photos.[53] The service was later renamed "Adobe Revel".[55] Later that same year in October, Adobe acquired Nitobi Software, the maker of themobile application development frameworkPhoneGap. As part of the acquisition, the source code of PhoneGap was submitted to theApache Foundation, where it becameApache Cordova.[56]
In November 2011, Adobe announced that they would cease development of Flash for mobile devices following version 11.1. Instead, it would focus on HTML5 for mobile devices.[57] In December 2011, Adobe announced that it had entered into a definitive agreement to acquire privately held Efficient Frontier.[58] In December 2012, Adobe opened a new 280,000-square-foot (26,000 m2) corporate campus inLehi, Utah.[59]
In 2013, Adobe endured a major security breach. Vast portions of the source code for the company's software were stolen and posted online[60] and over 150 million records of Adobe's customers were made readily available for download.[61] In 2012, about 40 million sets of payment card information were compromised by a hack at Adobe.[62]
Aclass-action lawsuit alleging that the company suppressed employee compensation wasfiled against Adobe, and three otherSilicon Valley–based companies in a California federal district court in 2013.[63] In May 2014, it was revealed the four companies, Adobe,Apple, Google, andIntel had reached an agreement with the plaintiffs, 64,000 employees of the four companies, to pay a sum of $324.5 million to settle the suit.[64]
2011 saw the company first introduceAdobe Creative Cloud, a $600/year subscription plan to its creative software as opposed to a one-time perpetual license payment which could often top $2000 for creative professionals. The initial launch of Creative Cloud alongside Creative Suite 5 users came at the same time that Adobe ran into controversy from users of Adobe's creative software, with users of Adobe software stating that the original perpetual and subscription pricing plans for CS5 would be unaffordable for not only individuals but also businesses, as well as refusing to extend a Creative Suite 6 discount to non-CS5 users. The original announcement of Adobe Creative Cloud was met with a positive reception from CNET journalists as a much more enticing plan, and Creative Cloud was first released in 2012, though a later CNET survey evidenced that more users had a negative perception about subscription creative software than a positive view. The original pricing plan for Creative Cloud was $75 per month for the entire suite of software, though Adobe discounted the monthly cost to $50 for users willing to commit to at least one year of continuous subscription for Creative Cloud, and down to $30 per month for former CS users with the one year commitment.[65][66]
By 2013, Adobe decided that CS6 would be the last version of Creative Suite software that would be sold through perpetual licensing option, and in May announced that a Creative Cloud subscription would be the only way to get the newest versions of Photoshop, Illustrator, and other Adobe creative software. Reception to the mandatory subscriptions for future Adobe software was mostly negative, despite some positive testimonies on the move from customers and Adobe's attraction of 500,000 Creative Cloud subscribers by the service's first year.[67] The switch to subscription only also did not detersoftware piracy of Creative Cloud services; within the first day of the first version of Photoshop exclusively made for Creative Cloud being released, cracked versions of Adobe Photoshop CC 2013 were found onThe Pirate Bay, an online website used for distributing pirated software.[68][69]
Further acquisitions and failed buyout of Figma (2018–2023)
In March 2018, at Adobe Summit, the company andNvidia announced their association to upgrade their AI and profound learning innovations. They planned to streamline Adobe Sensei AI and machine learning structure for NvidiaGPUs. Adobe and Nvidia had cooperated for 10 years on GPU quickening. This incorporates Sensei-powered features, e.g. auto lip-sync in Adobe Character Animator CC and face-aware editing in Photoshop CC, and also cloud-based AI/ML items and features, for example, picture investigation for Adobe Stock and Lightroom CC and auto-labeling in Adobe Experience Supervisor.[70]
Adobe further spent its time from 2018 to 2023 acquiring more companies to boost both Creative Cloud and theAdobe Experience Cloud, a software suite which increased business. These included e-commerce services providerMagento Commerce from private equity firmPermira for $1.68 billion in June 2018,[71][72]Marketo for $4.75 billion in 2018,[73] Allegorithmic in 2019 for just under $160 million,[74][75] andWorkfront in December 2020 for $1.5 billion.[76] 2021 additionally saw Adobe add payment services to its e-commerce platforms in an attempt to compete withShopify, accepting both credit cards andPayPal.[77]
In July 2020, as the United States presidential elections approached, the software giant imposed a ban on the political ads features on its digital advertising sales platform.[78]
On November 9, 2020, Adobe announced it would spend US$1.5 billion to acquireWorkfront, a provider of marketing collaboration software.[79] The acquisition was completed in early December 2020.
On August 19, 2021, Adobe announced it had entered into a definitive agreement to acquire Frame.io, a leading cloud-based video collaboration platform. The transaction is valued at $1.275 billion and closed during the fourth quarter of Adobe's 2021 fiscal year.[80]
Adobe announced a $20 billion acquisition ofFigma, anAdobe XD competitor, in September 2022,[81] its largest to date.[82] Regulatory scrutiny from the US and European Union began shortly after due to concerns that Adobe, already a major player in the design software market with XD, would have too much control if it also owned Figma. At the time of the announcement to acquire Figma, Adobe's share over the creative software market and design-software market was almost a monopoly.[83] In December 2023, the two companies called off their merger, citing the regulatory challenges as a sign to both that the deal was not likely to be approved. Adobe paid Figma a $1 billion termination fee per their merger agreement.[84][85][86][87]
FTC lawsuit and terms of service update (2024–present)
On June 17, 2024, theUS Federal Trade Commission together with theUS Department of Justice filed a lawsuit against Adobe for its subscription business model practice, citing hidden termination fees and the company pushing customers towards more expensive plans.[88]
In June 2024, after facing backlash for its changes to theterms of service, Adobe updated them to explicitly pledge it will not usecustomer data to train itsAI models.[89]
Amicrostock agency that presently provides over 57 million high-resolution, royalty-free images and videos available to license (via subscription or credit purchase methods). In 2015, Adobe acquiredFotolia, a stock content marketplace founded in 2005 by Thibaud Elziere, Oleg Tscheltzoff, and Patrick Chassany which operated in 23 countries.[91] It was run as a stand-alone website until 2019, but has since been integrated into Adobe Stock.[91]
A family of content, development, and customer relationship management products, with what Adobe calls the "next generation" of its Sensei artificial intelligence and machine learning framework, introduced in March 2019.[92]
Adobe has been criticized for its pricing practices,[93][94] with retail prices being up to twice as much in non-US countries.[95]
After Adobe revealed the pricing for the Creative Suite 3 Master Collection, which was £1,000 higher for European customers,[96] a petition to protest over "unfair pricing" was published and signed by 10,000 users.[97] In June 2009, Adobe further increased its prices in the UK by 10% in spite of weakening of the pound against the dollar,[98] and UK users were not allowed to buy from the US store.[99]
Adobe'sReader andFlash programs were listed on "The 10 most hated programs of all time" article byTechRadar.[100]
Hackers have exploited vulnerabilities in Adobe programs, such as Adobe Reader, to gain unauthorized access to computers.[101]Adobe's Flash Player has also been criticized for, among other things, suffering from performance, memory usage and security problems. A report by security researchers fromKaspersky Lab criticized Adobe for producing the products having top 10 security vulnerabilities.[102]
Observers noted that Adobe was spying on its customers by includingspyware in the Creative Suite 3 software and quietly sending user data to a firm namedOmniture.[103] When users became aware, Adobe explained what the suspicious software did and admitted that they: "could and should do a better job taking security concerns into account".[104] When a security flaw was later discovered in Photoshop CS5, Adobe sparked outrage by saying it would leave the flaw unpatched, so anyone who wanted to use the software securely would have to pay for an upgrade.[105] Following a fierce backlash Adobe decided to provide the software patch.[106]
Adobe has been criticized for pushing unwanted software including third-party browser toolbars and free virus scanners, usually as part of theFlash update process,[107] and for pushing a third-partyscareware program designed to scare users into paying for unneeded system repairs.[108]
On October 3, 2013, the company initially revealed that 2.9 million customers' sensitive and personal data was stolen in a security breach which included encrypted credit card information.[109][110][111] Adobe later admitted that 38 million active users have been affected and the attackers obtained access to their IDs and encrypted passwords, as well as to many inactive Adobe accounts.[112][113] The company did not make it clear if all the personal information was encrypted, such as email addresses and physical addresses, thoughdataprivacy laws in 44 states require this information to be encrypted.[114][115]
In late 2013 a 3.8 GB file stolen from Adobe and containing 152 million usernames, reversibly encrypted passwords and unencrypted password hints was posted on AnonNews.org.[116]LastPass, a password security firm, said that Adobe failed to use best practices for securing the passwords and has notsalted them.[117][118] Another security firm,Sophos, showed that Adobe used aweak encryption method permitting the recovery of a lot of information with very little effort.[119] According toIT expert Simon Bain, Adobe has failed its customers and 'should hang their heads in shame'.[120]
Many of the credit cards were tied to theCreative Cloud software-by-subscription service.[121] Adobe offered its affected US customers a free membership in a credit monitoring service, but no similar arrangements have been made for non-US customers.[122][123] When adata breach occurs in the US, penalties depend on the state where the victim resides, not where the company is based.[124]
After stealing the customers' data, cyber-thieves also accessed Adobe'ssource code repository, likely in mid-August 2013.[125] Becausehackers acquired copies of the source code of Adobeproprietary products,[126] they could find and exploit any potential weaknesses in its security, computer experts warned.[127] Security researcherAlex Holden, chief information security officer of Hold Security, characterized this Adobe breach, which affectedAcrobat,ColdFusion and numerous other applications, as "one of the worst in US history".[128] Adobe also announced that hackers stole parts of the source code ofPhotoshop, which according to commentators could allow programmers to copy its engineering techniques[129] and would make it easier to pirate Adobe's expensive products.[130][131]
Published on a server of a Russian-speakinghacker group,[132] the "disclosure of encryption algorithms, other security schemes, and software vulnerabilities can be used to bypass protections for individual and corporate data" and may have opened the gateway to new generationzero-day attacks. Hackers already used ColdFusion exploits to make off with usernames and encrypted passwords ofPR Newswire's customers, which has been tied to the Adobe security breach.[133] They also used a ColdFusion exploit to breach Washington state court and expose up to 200,000 Social Security numbers.[134]
In 1994, Adobe acquired Aldus Corp., a software vendor that sold FreeHand, a competing product.[135][136]FreeHand was direct competition toAdobe Illustrator, Adobe's flagship vector-graphics editor.[135][136] TheFederal Trade Commission (FTC) intervened and forced Adobe to sell FreeHand back to Altsys, and also banned Adobe from buying back FreeHand or any similar program for the next 10 years (1994–2004).[135][136] Altsys was then bought byMacromedia, which released versions 5 to 11.[136] When Adobe acquired Macromedia in December 2005, it stalled development ofFreeHand in 2007, effectively rendering it obsolete.[135][137] With FreeHand and Illustrator, Adobe controlled the only two products that compete in the professional illustration program market for Macintosh operating systems.[135]
In 2011, a group of 5,000 FreeHand graphic designers convened under the bannerFree FreeHand, and filed a civil antitrust complaint in the US District Court for the Northern District of California against Adobe.[135][136][138][139] The suit alleged that:
Adobe has violated federal and state antitrust laws by abusing its dominant position in the professional vector graphic illustration software market [...] Adobe has engaged in a series of exclusionary and anti-competitive acts and strategies designed to kill FreeHand, the dominant competitor to Adobe's Illustrator software product, instead of competing on the basis of product merit according to the principals of free market capitalism.[135][138][139]
Adobe had no response to the claims and the lawsuit was eventually settled.[135][137] The FreeHand community believes Adobe should release the product to an open-source community if it cannot update it internally.[136]
As of 2010[update], on its FreeHand product page, Adobe stated, "While we recognize FreeHand has a loyal customer base, we encourage users to migrate to the new Adobe Illustrator CS4 software which supports both PowerPC and Intel–based Macs and Microsoft Windows XP and Windows Vista." As of 2016[update], the FreeHand page no longer exists; instead, it simply redirects to the Illustrator page. Adobe's software FTP server still contains a directory for FreeHand, but it is empty.[140]
In April 2021, Adobe received criticism from Twitter users for the company's cancellation fees after a customer shared a tweet showing they had been charged a $291.45 cancellation fee for their Adobe Creative Cloud subscription. Many also showed their cancellation fees for Adobe Creative Cloud, with this leading to many encouragingpiracy of Adobe products and/or purchase of alternatives with lower prices or usingfree and open-source software instead. Furthermore, there have been reports that with changing subscriptions it is possible to avoid paying this fee.[141][142]
TheU.S. Department of Justice and the FTC filed a lawsuit against Adobe and two of its executives in June 2024, alleging that the company's deceptive subscription practices and cancellation policies violated theRestore Online Shoppers' Confidence Act. According to the lawsuit, the company purportedly used small text disclosures, optional input fields, and complex web of links to obscure a concealed early termination fee. This fee reportedly amounted to fifty percent of the remaining value of annual contracts for users who chose to cancel early in the first year, resulting in significant penalties. Customers who tried to cancel services by contacting customer service faced obstacles, including dropped calls and multiple transfers between representatives; others continued to be billed by Adobe, under the mistaken belief that they had successfully ended their subscriptions.[143][144][145][146]
On June 5, 2024, Adobe updated theirterms of service (TOS) for Photoshop stating "we may access your content through both manual and automated methods, such as for content review." This sparked outrage with Adobe users, as the new terms implied that the users' work would be used to train Adobe's generative AI, even if the work was under anon-disclosure agreement (NDA).[147][148]
Adobe responded the following day clarifying that they will not use user data to train generative AI or take users work as their own; however, they neglected to respond to the part in the TOS that gives Adobe the ability to view or use work that is contracted under an NDA.[149]
^Rholetter, Wylene (2013). "Charles Geschke: Co-founder and co-chairman of Adobe".Computer Technology Innovators. Ipswich, MA: Salem Press. pp. 104–[108].ISBN9781429838054.
^abWawro, Thaddeus (2000). "Charles Geschke & John Warnock: the fathers of desktop publishing".Radicals and visionaries. Entrepreneur Press. p. 143.ISBN1891984136.
^Wester, Edward (2000). "Chapter 6: The Eighties: PDLs, Adobe, and John Warnock".Print unchained: fifty years of digital printing, 1950–2000 and beyond: A saga of invention and enterprise. West Dover, VT: DRA of Vermont. p. 162.ISBN0970261705.
^"Adobe to Acquire Figma" (Press release). San Jose, California: Adobe. September 15, 2022. Archived fromthe original on September 15, 2022. RetrievedAugust 19, 2024.
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