UK regulators have concerns about Adobe’s Figma acquisition

The UK competition watchdog has completed its preliminary investigation into Adobe’s $20 billion acquisition of cloud-based product design platform Figma, warning that the merger poses a “significant competitive threat to Adobe” and harms UK designers. There may be a “significant reduction in competition”. Market. The Competition and Markets Authority announced on Friday that unless Adobe or Figma could offer an “acceptable undertaking” to address its concerns by July 7, the acquisition would be subject to an in-depth investigation that could completely derail the deal. Runs the risk of taking off.

Senior merger director Sorcha O’Carroll said, “We are concerned that this deal could stifle innovation and lead to higher costs for companies that rely on Figma and Adobe’s digital tools – as they enable customers to innovate And stop competing to provide a better product.” in CMA. “Until Adobe is able to put forth a viable solution to our concerns in the coming days, we will proceed with a more in-depth investigation.”

According to Summary of CMA’s DecisionBoth parties to the merger argued that Adobe was not a significant competitor to Figma in the all-in-one product design software market. In its findings, the CMA acknowledged that Adobe had “significantly underinvested” in the company’s own dedicated product design application, Adobe XD, prior to the merger, but expressed concern that the software would become “one of only a limited number of close alternatives to Figma”. “It’s made up. along with services like Sketch,

Furthermore, while Adobe stated that the decision to cancel the unnamed project was unrelated to the merger. However, the CMA claims that internal documents comparing features planned for the tool to those already provided by Figma indicate Adobe’s prior intention to compete directly with the company.