Reactions to Adobe-Day purchase

A week ago, we woke up to the news that Adobe (NASDAQ: ADBE) had purchased Day Software for $240 million--a move that seemed surprising on a number of levels. 

First of all, Day is company that uses many open-source components and frequently contributes back to the community. While Adobe has dabbled in open source (most obviously in its relationship with Alfresco), it is mostly a proprietary company that concentrates primarily on front-end tools such as Dreamweaver, Flash, Photoshop and InDesign (to name but a few).

Yet Adobe has always tried to find a place on the back end and perhaps a web content management system like Day's provides the entrée they have been looking for. But what of Adobe's existing relationship with Alfresco, another open source content management vendor, and what might the deal mean to open source content management in general?

The deal makes sense for both parties

Ultimately, says Alan Pelz-Sharpe of the Real Story Group (formerly CMS Watch), the deal makes sense for both parties. "Users of Creative Suite and LiveCycle ultimately want to publish their work through something, so taking on what Adobe would likely see as 'Web Publishing' is a logical step," Pelz-Sharpe says.

As for Day, it comes down to a small company simply cashing in, he says. "Every small technology firm has a point where they want to exit and cash in their chips, the options for Day to grow organically were limited, and growth by acquisition is highly risky--I think it was time, that's all."

The impact on open source

There is a long line of small open source vendors out there and it begs if this will have any impact on other open source content management vendors. Cheryl McKinnon, who is chief marketing officer at open source content management vendor, Nuxeo, believes purchasing Day may actually drive Adobe to be more open in the future. In fact, she points out that a recent Gartner report gave Adobe high ratings on its open-source strategy.

Pelz-Sharpe sees it more as part of the growing commoditization of content management. "For WCM as a whole, it's just more commoditization and part of an ongoing trend, but I'm not sure it will have much impact at all on open source CM," he said.

Adobe and Alfresco

One of the curious aspects of this deal is that Adobe had an ongoing relationship with another open source content management vendor, Alfresco. On its face, it would seem the deal would bode badly for Alfresco. Pelz-Sharpe, for one believes this could mark the beginning of the end for the relationship.

"This will certainly challenge the relationship. Indeed many speculated that Alfresco themselves would have been the acquisition target, but it was not to be. Most likely in the long term the core repository services OEM'd by Alfresco will be replaced by Day services."

But John Newton, CTO at Alfresco says the relationship remains strong and the two companies can still continue to work together. "The relationship with Adobe stands as is and continues with the contract through its period into 2012," Newton says. "Adobe has purchased Day for web content management to complement its customer engagement services. Alfresco is used as part of Adobe Livecycle solutions and its Content Services. These use cases are very different from each other and Adobe recognizes this."

While this move makes sense for Adobe, whether they can successfully incorporate Day and its team into Adobe is the big unknown. As Pelz-Sharpe points out, the move makes sense for Adobe, a company that has struggled to gain traction in the enterprise. "Moving deeper and more broadly into the enterprise has always been a challenge for Adobe, as has selling more complex potentially consultative based enterprise software."

He believes that Adobe clearly sees a future for itself in web multi-media and have decided to buy selectively rather than develop. To him (and to me), it is a sensible move, but we will need to wait and watch, to see if it's a successful strategy for Adobe.

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