Business Strategy: Apple, with its Final Cut Pro X, lets Adobe & Avid refight their Battles of Waterloo #fail

People don’t usually win by betting against Apple as Apple has shown the world so many great products in recent years. But I am going to join a critical Oscar editor and take my chance and bet my $1 against Apple. I say Apple may have materially damaged its Final Cut Pro brand/lovemark by giving Adobe and Avid some meaningful chances into retake some of the long lost market share. Assuming Adobe and Avid have good products and execute their plans well.

In fact, I am willing to go out on a limb and say Apple is giving “losers” Adobe and Avid new chances to refight their Battles of Waterloo in the field of video editing software. In the battlefield, your opponents are usually not too kind in letting you fight again and learn from your previous mistakes.

I think Apple has very much underestimated the influence of professional editors on prosumers and new beginning editors. For me, I remember years ago one of the reasons I took Final Cut Pro seriously and bought into it was because of FCP was being highly regarded and used by the professionals.

OK, NBA players have been locked out, but imagine if a brand of basketball shoes have been founded to restrict certain shots/moves by NBA players thus making them unable play their best games, will you still buy the shoes?

As my friend like to say, the following is my brand of poison/observations. Readers beware.

1) Adobe SWITCH Campaign

Adobe is smart and quick to launch a Premiere SWITCH campaign (note: press release here, 50% off Production Premium or Adobe Premiere Pro “if you own Apple Final Cut Pro or Avid Media Composer with offer code SWITCH. Offer ends September 30, 2011”) making its Production Premium software costing $850 and Adobe Premiere Pro software costing $400 respectively after discount. [HT Apple Insider] Update: See also PC World review of software.

2) Full function Production Premium group of softwares at significant discount

The Production Premium software has quite a number of useful & powerful softwares and can be a good fit for professional/prosumer FCP7 users. Given Apple‘s willingness to give up its professional users, it makes sense for professional to buy and learn it for risk mitigation/management purpose. Of course, at $850, it is a bit out of reach for people who can only afford the FCPX $299 prices.

3) Adobe Premiere Pro on SWITCH discount at $400. Why $400?

Now moving on to Adobe Premiere Pro, if Adobe is smarter, they should just lower its price to $299 to match the FCPX price for new purchase!

We are talking about business strategy to regain long lost market share! A market that has been dominated by Apple Final Cut Pro for a long time. I don’t understand why Adobe is having this $400 pricing? Why $100 higher than Apple’s $299?

The goal should be: Don’t give switcher a reason ($100) to NOT switch. I think this $100 is insignificant at this crucial moment in time. If Abode has better business sense/advisers, it will and should immediately lower its Adobe Premiere Pro SWITCH price to $299 and refund those already switched with the $100. Why? To me, the number of FCP switchers can be a GREAT asset in turning the tide against Apple Final Cut Pro (assuming Adobe’s product is good or better)! Numbers speaks volume.

If the number of SWITCHERS is high, it can be a great selling tool in shaking the trust (blind trust?) in Apple. Imagine advertising copy that reads:

“5,000 Final Cut Pro users have switched to Adobe Premiere Pro. 

What are you waiting for?“

Priceless!

To me, Adobe has lost its Battle of Waterloo years ago to Apple when Final Cut Pro turned to a gold standard. Now Apple has reopened the history book and give Adobe and others another chance to fight the Battle of Waterloo again, what are you “$%&@@”ing around with $100 per software? Are you kidding me?

Adobe and others should go into attack mode aggressively when Apple is showing its arrogance. While it may be tough for Apple to turn around on a dime and change this late of the game but one shouldn’t count on Apple to stay unchanged as Goliath forever. Sooner or later Apple will wake up.

In terms of business strategy, this is the moment to aggressively attack Apple when Apple has made foolish and strategically awful decisions with FCPX. Right now you have months (12-18 months?) of uncertainty at Apple. Take advantage of it.

4) Avid’s Media Composer 5.5 at the promotional price of $995 USD

Now onto Avid. It is very cool that Avid’s President & CEO Gary Greenfield blogs “Making great products to serve professionals is our lifeblood” and offer a promotional discount, “Final Cut Pro (excluding FCP X) users can get Media Composer 5.5 at the promotional price of $995 USD” or try the Media Composer software for free for 30 days.

With the $995 price, Media Composer can be attractive enough for FCP7 users but it will be a bit out of reach for FCPX users. Avid has made its business decision to sell to the professionals, especially those can afford the expensive dedicated hardwares, so not playing in the FCPX $299 is simply the result of that.

5) Concluding Thoughts

Apple‘s launch of FCPX has provided people interested in business strategies to see how a giant made mistakes and try to recover. At the same time, Adobe and Avid are not sitting ideally by and doing nothing.

In every risk comes opportunities. Will see how things turn out. I am definitely staying tune for this battle.

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Disclosure: I have never worked for Apple, Adobe, or Avid and don’t directly own shares of these companies. And none of my indirect investments (mutual funds or index funds, etc.) have these companies as key holdings.

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Worth a read “Former Final Cut Pro Developer: No, Apple Doesn’t Care About Pros“, Forbes (emphasis added, see Sachin Agarwal’s blog entry for his full argument),

“So what is Apple thinking? It turns out, Apple was thinking big. “The pro market is too small for Apple to care about it,” Agarwal writes. “Instead of trying to get hundreds or even thousands of video professionals to buy new Macs, they can nail the pro-sumer market and sell to hundreds of thousands of hobbyists like me.”“