Tthe chief executives of Microsoft and Adobe Systems met recently to discuss, among other possibilities, a potential merger of the two tech giants. The idea was one of several floated by the two, Steven A. Ballmer of Microsoft and Shantanu Narayen of Adobe, as they brainstormed ways to combat Apple. But what would a union of the two bring — if, of course, it were to come to pass at all?
Investors certainly seem happy about the prospect. Despite its size — $212.7 billion in market value, with $36.6 billion in cash and short-term investments as of June 30 — Microsoft hasn’t really done big acquisitions. (Its largest attempt was for Yahoo in 2008, and that went nowhere.) Adobe would be its largest by far, with a market value of $15.1 billion as of Thursday.
The two tech giants have held merger talks before, but didn’t go far because of Microsoft’s concerns over antitrust consequences. This time, however, Microsoft isn’t the big gorilla in the tech landscape, so it is possible a deal wouldn’t be as problematic now. Still, the talks appear not to have advanced beyond a very preliminary discussion.
Both companies have several points of contention with Apple, but they share one: The maker of iPhones and iPads won’t let their multimedia platforms onto the popular devices. Adobe makes the ubiquitous Flash software, while Microsoft makes the rival Silverlight platform. Flash is now available on Google’s Android operating system and Microsoft’s forthcoming Windows Phone 7.
Microsoft may also want Adobe’s other software products, which include the Creative Suite, home of Photoshop and Illustrator, and Acrobat.
Check the space for more on the Microsoft-Adobe deal…..
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