'Nightmare': Adobe bought WHO for $20bn?

Analysts say Adobe is being squeezed in the market by Australian tech darling Canva, and this acquisition is out of 'need and not opportunity'.

Analysts say Adobe is being squeezed in the market by Australian tech darling Canva, and this acquisition is out of 'need and not opportunity'.

"Devastating blow", "a nightmare" and the "end of an era" are not usually phrases you would associate with the buyout of a product that's only been around for six years.

When Adobe announced it would acquire private company Figma, a collaborative graphic design and product development tool for $20bn - the biggest deal in its history - that was exactly the reaction from the international design community.

Figma is a free platform used by designers and engineers, which grew in popularity over the past three years as designers worked together on projects from a distance. 

Adobe is best known for subscription-based software like Photoshop, where a package with more than 20 apps costs about AUD $80 a month for an individual and $22 for students and teachers.

As the Wall Street Journal reported, Bernstein Research analyst Mark Moerdler wrote this is the result of Adobe being squeezed in the market by both Figma and Australian software Canva.

“It would seem that this is a hefty price tag (even considering its very strong growth rate) given the recent decrease in valuations across software and especially at Adobe,” he wrote. “Our initial thoughts are that this was an acquisition driven by need and not opportunity.”

Figma being purchased by Adobe makes me concerned about the affordability of good design tools. Because of price discrimination, it used to be cheaper to fly from Australia to the US (and back again!) to buy Adobe's full creative suite than it was to simply buy it in Australia.

— Cody J. Phillips (@drcodyjphillips) September 16, 2022

Figma is promising that the program will remain free for educational institutions, yet 'Figmates' are concerned the pay model may change, and the integrity of the brand may be compromised following the acquisition by the tech giant. 

"Recognising that we are in an unpredictable, inflationary environment, we currently have no plan to change Figma’s pricing. Finally, all of Figma will continue to be free for education," Figma CEO Dylan Field said in a statement.

"Adobe is deeply committed to keeping Figma operating autonomously and I will continue to serve as CEO," repeating his original vision for accessible developer tools.

$20B to kill the competition because you couldn't/wouldn't just make Xd better. It's a smart long game to eliminate Figma's growing future.

— Penina (@peninasharon) September 16, 2022

University of Western Sydney Design Lecturer Dr Daniel Johnston said his biggest concern was that his students might not be able to afford Figma once they left university if it became part of the Adobe creative suite.

"(It) would affect employability which would be a shame," he said.

He started using the platform in his classes in 2020 after he was told by industry partners it would increase the employability of his students, and he said he was proved right.

An Instagram Reel by NYC designer Jamey Gannon, shared widely by local graphic and product designer circles, said users were "scared that this beautiful piece of software would be changed or even killed", especially since many designers preferred Figma to Adobe. She said she feared that Adobe, once again basically having a monopoly, would lead to Figma no longer being free and highly accessible.

Another designer called it a "devastating blow to the design community".

Figma was launched by computer scientists Dylan Field and Evan Wallace about six years ago. If the deal goes through, the Wall Street Journal reported it would be one of the biggest buyouts of a venture capitalist-backed startup in US history.