Adobe is warning investors that it may take a hit on its profitability because customers are moving away from Flash.  That trend is almost entirely due to Apple’s crusade to avoid Flash in its iProducts.  Yesterday’s announcement that Apple would no longer accepting iPhone applications generated from 3rd party development products (Flash) made the situation all that more dire for Adobe.

But why does Adobe have to build exclusively for Flash/Air?  They already have a product, Dreamweaver, that spits out HTML.  They have products that export to open standard image, sound and video as well.

Adobe doesn’t make a penny on its Flash or Air players.  They make all of their money in the authoring tools.  If they could make a Flash->iPhoneOS conversion tool (no small feat), would it be that much harder to make a basic Flash5->HTML5 tool?  Sure, they’d likely start with a small subset of Flash capabilities, but this is a young standard and one they could take the lead in building.  

Video would be the obvious first step.

They could start with a video embedding application that encodes both Ogg (Firefox, Opera, Chrome) and H.264 (Safari, Chrome) videos.  If the user is using something like IE6, it could also embed a legacy Flash version as well.  Based on the browser detection, the web page could output the code for the best video format.  There would be no shortage of corporate need for this.  Automate (batch processing) it and it becomes all that more valuable.

Or, if you want to be a real pioneering money maker: Make iAds tools!

From that success they can start working on interactivity and server side capabilities of Flash.  With HTML5’s Database capabilities, they could even build offline applications that they currently run with Air.  It would take a lot of work, but it’d be worth it for all parties involved.

Perhaps Adobe is working on these types of tools behind closed doors, I don’t know.  It would be a significant risk, as they stated in their 10K, not to.

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