During this year, I have seen a wonderful example in the tech industry of how the entrepreneurial free market system encourages innovation. Yes, this story involves Apple but the focus is on Adobe. Adobe is an incredibly innovative company. They produce tools for creative professionals such as Photoshop. The most notable innovation to come from Adobe is the Portable Document Format or PDF. In December 2005, Adobe purchased Macromedia which produced among other products, Flash. Everyone has been annoyed by the experience of going to a website and having to install or update the Flash Player. YouTube videos at first ran totally on Flash. Flash powered the video sharing sites and still does. In 2007, Adobe received a huge letdown. The iPhone was introduced. As is common knowledge now, iOS (the operating system for the iPhone, iPod Touch, iPad and AppleTV) does not support Flash and will probably will never support Flash. Apple encouraged web developers to use HTML5 to write mobile web applications and has the most advanced HTML5 mobile browser today. Google soon followed suit with Android but Mobile Chrome does support a limited version of the Flash Player. Microsoft with Windows Phone 7 is support HTML5 only as well. About 18 months ago, Adobe announced that it was developing a version of Flash that would allow developers to write applications that would run natively on iOS. This innovation would keep Flash developers using Flash. Apple responded by saying that it would not allow applications written using anything other than Objective-C (the primary programming language used for iOS and controlled by Apple). Adobe then began to put it's efforts towards HTML5 tools and has produced some excellent products that developers can use to target iOS. Apple did eventually back off and allow third party tools and languages so Flash applications can now run natively on iOS. The point here is that Adobe took the route of innovation. They didn't go to the government and try to claim that Apple was trying to push them out of the market unfairly. The looked at the direction the market was going and found new opportunities. If they had gone to the government and forced Apple to include Flash, iOS might not be the success it is today. Flash is a resource hog and makes even very powerful processors run hot. The choice to innovate is the right one.
Sun Microsystems chose not to innovate during the 90's with Java. Sun went to the government, and claimed Microsoft was trying to use its market share to force a proprietary version of Java onto Windows users and force Sun out of the market. Microsoft was labeled as 'too big to fail' and a threat to innovation and the consumer. The government agreed with Sun and Microsoft was forbidden from distributing Java with Windows. Today Microsoft is not the company it once was and is no longer a threat to Java. More ironic is that the 'protection' afforded to Sun and Java didn't work. Sun Microsystems was acquired by Oracle, a company that makes database software. Sun Microsystems is run by Larry Ellison who is an "A shift-4 shift-4" in my opinion. Oracle now has control of Java, the programming language that is used to write a majority of the applications on Android which is Google's mobile OS and which has dominant market share. The amazing thing is that one of Oracle's first moves after acquiring Sun, was to sue Google for copyright infringement on intellectual property based on how Google used Java in Android. So, the government 'protected' Java from a company using it to innovate (Microsoft). Thus, Java was not given the exposure it would have had if it had been distributed with Windows. Sun eventually failed and was bought by another company who is suing Google, the manufacturer of the largest consumer success of Java, Android.
Worked out just fine don't you think?
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