Gadget-crazed consumers who rush to Apple stores on iPad release day may not be aware of a behind-the-scenes standoff between Apple (AAPL) and Adobe (ADBE), but they'll likely feel the effects.
Many Web applications may not work on Apple's uber-hyped new iPad because the company decided not to support Adobe Flash, a popular platform for adding multimedia to Web pages. This longstanding corporate conflict has been hotly discussed in the tech community since the arrival of the iPhone.
But mainstream buyers of Apple products may not even be aware of it until they try playing a Flash-based game or watch the free online video service Hulu on their new iPads. Hulu, like several other Web-based video players, runs on Flash. Incidentally, Hulu is reportedly toying with the idea of a for-fee service that will run on the iPad and iPhone.
Compromising the User Experience?
Apple CEO Steve Jobs says if the iPad supported Flash-based applications, it would compromise the user experience. He claims, for example, that if the iPad ran Flash, the battery life would be reduced to 1.5 hours. Similarly, he reportedly told employees in a private town hall meeting that Adobe was "lazy" and that Flash was too "buggy" to use on the iPad. He argued that when a Mac crashes, more often than not it's because of Flash.
Some developers have other theories as to why the companies have never come to an agreement on Flash. One opines that it's because Flash could never effectively work on a touchscreen device because of the way the mouse is supposed to hover over menus or games in Flash-based applications. Equities analyst Trip Chowdhry, who covers Adobe shares, doesn't think it makes sense for Apple to support Flash, even though Adobe would financially benefit from it.
"Too many websites abuse Flash," Chowdhry says. "Have you gone to to one of those sites where some idiot starts speaking as soon as the page loads and you can't figure out where it's coming from? People are turned off of it. Flash causes clutter while Apple is all about simplification."
Aesthetics aside, Adobe Flash is widely used on the Internet, and losing access to Flash-based apps means users may miss out on a significant chunk of the Web. It could be akin to cutting off a digit or a limb. Presumably in anticipation of this problem, Apple prepared a list of "iPad-ready" sites.
For Adobe, Apple's refusal to play nicely means that it loses out on a massive market -- more than 42 million iPhones have sold since the device was rolled out in 2007. It's not clear yet how large the iPad market will be. The more devices Adobe can get Flash on, the better its sales of developer tools.
But neither Adobe or Apple seem to have any intention of softening relations. As Apple prepares for its much hyped iPad release, Adobe has snuggled up with Google (GOOG), which recently announced it would incorporate Flash into its Chrome desktop browser.
And although the iPhone had something like 25% of the U.S. smartphone market at the end of the January 2010, smartphones makers Palm (PALM), Google and Research In Motion (RIMM), which collectively make up roughly 56% of the U.S. smartphone market, according to market researcher comScore, have all committed to roll out Flash support on at least some of their smartphones. Take that, Mr. Jobs.
What are Penny Stocks
The lucrative and dangerous world of penny stocks.View Course »