Apr 17, 2006

Concern For Adobe From Microsoft Seen Overstated

Source: Forbes
Written by Kate DuBose Tomassi

Despite the “constant chatter” of investors about the potential threat to Adobe Systems from Microsoft’s expected entry into some of Adobe’s markets, Piper Jaffray senior research analyst Gene Munster said the threat may be overblown.

“While Microsoft is clearly always a competitor worth taking seriously, we continue to believe the bark is worse than the bite,” the research analyst wrote in a report Monday. “We do not believe Adobe’s business will suffer as a result of the entry of Microsoft’s competing offerings.”

Microsoft (nasdaq: MSFTnewspeople ) is expected to compete with Adobe’s Illustrator with its Expression Graphic Designer, which should begin shipping in early 2007.

“We expect Microsoft will price the product below Adobe’s Illustrator,” the analyst said. “We believe, however, that Adobe’s long-term presence and installed base will allow it to maintain its market share.”

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