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UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

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Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#41

Post by drumhead »

pavlov wrote: post #28
drumhead wrote: post #27

Earlier quoted context omitted.

Adobe's actually done investors a favour and made a realistic enterprise valuation of the company for everyone. If it's worth $20bn to them then it's not likely to float for $5bn. They clearly think there's value there or some kind of competitive advantage that makes the company worth that much.

The problem is that the company is worth $20 billion only to Adobe. And that explains why antitrust authorities around the world are interested in this deal: that kind of discrepancy suggests a market distortion in progress.

What about Adobe's competitors? It's not going to be worth that much less to them either

Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#42

Post by fauigerzigerk »

spacebanana7 wrote: post #26
barnabee wrote: post #24

Earlier quoted context omitted.

This argument makes absolutely no sense to me. The large tech acquirers have extremely high market valuations partly because of the expectation that they continue to get away with doing exactly this. If we had more competent competition regulators and this sort of acquisition was basically not on the cards at all, ever, once a company reaches a certain size then that value would stay in the innovating startups until…

> This argument makes absolutely no sense to me. There are some business models where acquisition is the only viable way to make money. Deepmind, Shazam, and Giphy were largely valuable because they create value for other big tech companies with respect to customer acquisition, market positioning and intellectual property. These companies had limited ability to make profits on their own. One can still argue though th…

>There are some business models where acquisition is the only viable way to make money.

Maybe so, but blocking a dominant company from buying out its closest competitor is not quite the same thing as banning all acquisitions.

Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#44

Post by pavlov »

drumhead wrote: post #41
pavlov wrote: post #28

Earlier quoted context omitted.

The problem is that the company is worth $20 billion only to Adobe. And that explains why antitrust authorities around the world are interested in this deal: that kind of discrepancy suggests a market distortion in progress.

What about Adobe's competitors? It's not going to be worth that much less to them either

Which competitors? I can’t think of anybody but Adobe who would pay a premium for Figma.

It doesn’t fit in Autodesk’s portfolio, and their acquisition activity tends to be frugal.

Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#45

Post by edgyquant »

rvz wrote: post #6

Unsurprisingly. [0] Did people here really think that the regulators are going to allow this merger to happen? Adobe might as well pay the $1BN break up fee and the Figma will just use that to fund their IPO. [0] https://news.ycombinator.com/item?id=33919862

I did not want this to go through, but totally expected it since I’m in the US and until a few months ago it seemed our regulators no longer cared about monopolies

Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#47

Post by mattkevan »

8ytecoder wrote: post #37
quitit wrote: post #17

Earlier quoted context omitted.

Adobe, Netflix, Google, etc. They all need to realise one thing. You can choose to start something, but it's only the audience that can choose to end it. Whether that's a new app, series, or web tool: the problem is the same, no one is going to invest their time and effort on something that will be canned if it is not an instant success. Each are now trapped in a problem of their own making: people avoid their new of…

We need a term for it - the fear of adopting something because it might be cancelled based on past history leading to the cancellation further confirming that these companies would cancel new products.

The word Google has already been used as a noun, so we could slightly repurpose it and use it again.

E.g. “That Netflix show is fantastic but I wouldn’t bother starting it as it got Googled at the end of the first season.”

Or:

“Google’s new messaging service looks cool but I’m not going to get everyone to use it as I bet they’ll only go and Google it in about 18 months.”

Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#48

Post by M2Ys4U »

lhnz wrote: post #21

On the contrary, the ability for startups to be purchased by larger companies is the majority of the financial incentive towards creating startups. If competition regulators prohibit these transactions, it will harm the startup ecosystem and reduce innovation.

>reduce innovation

Maybe the real innovation that we need is how to create companies that are designed to operate indefinitely as a going concern, breaking even or turning a profit without the need for an "exit" event.

Let's work on business fundamentals that aren't three financial engineering schemes in a trenchcoat, for once.

Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#49

Post by ljm »

mattkevan wrote: post #3

Good. It absolutely would reduce innovation. Adobe have already canned XD, which was a poor alternative to Figma, but Adobe had to at least pretend to compete. Problem is, even though Figma have captured a large proportion of the digital design market, they took on so much funding that their only real options are a purchase or IPO. I don’t believe that subscriptions alone would bring in enough for the kind of returns…

I tried uninstalling Adobe software from my PC a few weeks ago.

Clicking on ‘uninstall’ booted up their cloud launcher app, and then I had to log in with an account, and then it had to install four or five different updates in sequence, and then it tried auto-updating the software I had installed, and after about thirty minutes of making sure Adobe obtained all of their analytics I was finally able to uninstall everything.

It is one of the worst user experiences I’ve ever encountered in recent times and it is a sign of what will happen to Figma under Adobe’s leadership. Figma is too much of a threat to them, so they can just squash it in an acquisition.

The revamped Serif suite is much nicer.

Re: UK competition regulator finds Adobe’s purchase of Figma could reduce innovation

#50

Post by mattkevan »

lhnz wrote: post #21

On the contrary, the ability for startups to be purchased by larger companies is the majority of the financial incentive towards creating startups. If competition regulators prohibit these transactions, it will harm the startup ecosystem and reduce innovation.

Or they could have focused on building a sustainable company that made a profit from the start and didn’t use VC money to essentially give the product away for free.

I was really unhappy about switching my design team to Figma because their only ways forward are to either IPO or get purchased, with all the pain they involve. Or worse, if they actually have to start making a profit, then prices will be raised immensely and features will be diminished.

None of those things lead to a stable platform to base on potentially years of work.

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