I see three primary ways that traditional vendors can compete with the cloud upstarts. First, if you can’t beat ’em, join em by creating your own online version. Second, build better features or some other competitive advantage and market to the power users who will pay for this better product. Third, Ignore ’em. You’ve got the power, so why bother?
I think we’ve seen the results of option three over time. IBM didn’t pay enough attention to Microsoft. Microsoft didn’t pay enough attention to Google. Is Google paying enough attention to Apple? Lest my friends brand me an Apple fanboy, the point here is that standing pat is not a good option when the alternative, almost-better option is free.
So that leaves option 1 and option 2. Adobe has launched an online version of the flagship Photoshop tool in direct response to some of these online newcomers. For the casual user, this is probably no more than simple competitive marketing. Use Photoshop.com or Sumopaint? The average user might flip a coin. The user who has some experience with Adobe might pick the incumbent, especially when given the option of transforming their free files into freemium files stored online or loaded locally to use in the version of Photoshop they already have on their work or home computers.
Option 2 — building a competitive advantage through a better product — might involve some combination of local and cloud computing over time. I believe that Adobe’s best market for non-print designers and other folks who don’t need very very large files is the large contingent of us who occasionally need tools like Photoshop but aren’t likely to spend $700 for a full license. I realize there is Photoshop Elements, but I’d rather spend some amount of subscription money for an Adobe partnership with a stock photo house so that I can have my basic photoshop program and access to the images that I’d like to manipulate and build.
If you’re a traditional vendor seeking to extend your brand online or a disruptive newcomer trying to attack the incumbent brand, the message is clear: find the 20% of the activities your users love that occupy 80% of their needs. Build your application so that those core things can be done online, and build either a subscription-based product to capture the rest of the base or an installed application that stores at least some of its information online. Add some value through bundling your services with an adjacent service (yes, I’m aware that the Adobe stock photo service didn’t go so well, but I think it’s worth another look) and make at least some of the features and files available to users where they are. If you are building online image editing, build an auto-preview that can be accessed from a mobile browser. You get the idea. Now start finding those ways to build great apps online.
