Adobe Faces Accusations of Market Elimination over Figma Acquisition

Adobe Faces Accusations of Market Elimination over Figma Acquisition

Published: October 14, 2022

Adobe’s recent acquisition of Figma stirred the emotions of digital creatives from the world over, causing many to claim foul play. It’s up to proper regulatory bodies to investigate whether market elimination is at the heart of the latest purchase and if any actions should be taken.

Figma's user base has vocalized its displeasure regarding the latest acquisition across the web, expressing concerns over the future of the rapidly-growing, web-based collaboration tool. From claims that Adobe will do away with Figma to worries over pricing and implementation, there seems to be mutual distrust toward the acquisition amongst designers.

The Deal Still Waits on Regulatory Clearances

The most egregious accusation of all is that Adobe is eliminating competition by acquiring Figma. If that were the case, regulatory bodies would have to intervene and bring the acquisition to a halt.

Since the deal isn’t supposed to go through until sometime in 2023, it is still “subject to the receipt of required regulatory clearances and approvals and the satisfaction of other closing conditions, including the approval of Figma’s stockholders.”

Since plenty of tools that designers use on a daily basis already belong to Adobe, acquiring the platform that makes distribution of all these tools possible could get antitrust authorities involved.

Adobe XD as a Direct Competitor

Despite all that, the crux of the issue remains Adobe XD. Adobe’s own collaboration tool has seen diminishing success over the years, and is objectively inferior to Figma. The existence of Adobe XD and its inability to compete with Figma are behind most of the allegations of market elimination leveled against Adobe.

However, there’s plenty of evidence to suggest that Adobe is simply acquiring a tool that far supersedes its own offering, and is looking to supplant the underperforming Adobe XD with the best web-based collaboration tool on the market.

Tony Brinton, founder of Brinton Design, suggests that Adobe realized it’s better to get Figma now instead of playing catch-up for years to come:

“It seems to me that Adobe recognized that Figma delivers a collaborative design experience that UX/UI professionals on the product side and marketing side have been wanting.”

Brinton goes on to highlight a major issue for Adobe, and that is its desktop-first nature and the slow transition to cloud, whereas Figma has been cloud-based from the get-go.

Besides, Adobe has a history of acquiring tools that expand its capabilities, rather than just eliminating competition, as well as replacing underperformers with newly-acquired assets.

“Back in the early 2000's Adobe acquired Macromedia and slowly took features from Freehand, Fireworks and other products and integrated them into their core offerings,” said Michael Hammonds, IBM design executive. “My hypothesis is that this is what they will do with Figma. I would not be surprised though if Figma becomes a core product and XD actually gets sunset.”

Adobe’s Previous Acquisitions

While Adobe’s track record of acquisitions is spotty at best, it stayed true to its core values throughout the years. Getting design professionals the best tools on the market under one roof has driven most of Adobe’s decision-making.

“Figma has become the clear standard for screen design, and this move allows Adobe to continue to be the one-stop shop for creative pros and for users to get everything they need for one price,” said Brian Nemhauser, vice president of product at Propel, Inc.

“Acquisition has been a crucial component of Adobe's business from the days of Photoshop and After Effects to Macromedia and now Figma. Each of those moves brought new expertise and capabilities to Adobe and resulted in significant new value for users and the company.”

Is There a Case for Market Elimination?

Arguably, Adobe doesn’t really have a horse in this race. With or without Figma, Adobe XD would likely never amount to much given the creative community’s overwhelming dislike of the tool. When the news of the acquisition broke, designers started looking into Figma alternatives such as Canva, Sketch, and Penpot, rather than giving Adobe XD another chance.

Also, don’t forget the price Adobe paid for Figma. There’s not even the slightest chance that Adobe would be able to get a return on investment if it simply used Figma to boost Adobe XD.

It’s possible to draw a comparison with Google’s acquisition of YouTube back in 2006. Google Video was nowhere near as successful as YouTube, and instead of eliminating competition, Google decided to acquire the superior video sharing service and run with it instead.

It remains to be seen whether the same fate will befall Adobe XD.

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