# Microsoft vs. Adobe: The Rivalry Heats Up

Want to watch a great boxing match? Just take a seat and watch the back-and-forth between Adobe Systems and Microsoft. I wrote about this fight-without-an-end last year, but now it seems the punches are being thrown with more intensity.

No surprise: Like two aging gladiators, the two software companies have managed to outlive and beat most of their peers. At face value, the fight is about Flash vs. Silverlight. Look deeper and the tussle is over not just online video but about cloud computing, rich Internet applications and mobile phones.

Microsoft has been jealous of Adobe’s Flash, a multimedia technology that Microsoft so desperately coveted that it tried to buy its then-owner, Macromedia, without much success. Instead, Adobe bought Macromedia in 2005 for $3.4 billion. Flash’s growing popularity as a core technology for online video, and Adobe’s efforts to extend it to the web applications market, hasn’t gone unnoticed by Microsoft. The barons of Redmond countered with Silverlight technology last year. They have upped the stakes by buying their way into the market — a time-tested strategy for the software giant. First it signed up MLB to get some mainstream usage. Then came NBC’s Olympics coverage online that led to a boost in the number of people using Silverlight to watch video. Today, the company announced that it’s going to invest in American Fork, Utah-based Move Networks, adding an undisclosed amount of funding to the startup’s$46 million Series C round.

It will be money well spent: Move’s customers include large TV companies such as FOX, CBS and ABC. They use Move’s technology to deliver higher-quality video to web watchers. As part of the investment, Move will “now support Windows Server-based encoding, Microsoft codecs and Silverlight DRM.” So now those companies can use Microsoft’s back-end products, which can replace Adobe’s server-side offerings, and halt the growing influence of Adobe’s DRM. In March, Move signed a deal in which it integrated its video distribution technology into Microsoft’s Silverlight technology.

Behind Microsoft’s spending spree is the realization that Adobe is a legitimate threat when it comes to cloud applications. When I spoke to Kevin Lynch, Adobe’s CTO, he talked at length about various Adobe technologies that could be used to build interesting cloud-based applications, that could be used on new emergent Internet devices. Adobe’s CoCoMo can challenge Microsoft on “collaboration.” Lynch also pointed out his desire to turn Adobe’s Flash into a vital component of the mobile ecosystem, something Microsoft so sorely desires.

Microsoft’s true intentions and the extent of the rivalry are best summed up in this comment by Scott Guthrie, corporate vice president of the developer division.

Silverlight 2 delivers much more than just media scenarios. One of the key advantages of Silverlight 2 is that it includes a cross-browser, cross-platform version of the Microsoft .NET Framework, specifically optimized for rich Internet applications (RIAs). That means you can build Silverlight applications using .NET languages.