Bingo! Adobe has a de facto monopoly on vector and bitmap editing software tools, and it would make total sense for this acquisition to be stopped by the government on that basis. "The government" in this case would be the DoJ's antitrust division headed by Jonathan Kanter [1]. Looks like the process is to send a letter requesting a "Business Review" [2]. It's probably a "fill out this simple 30 page form, wait 2.5 years (max!) and then have your review request politely declined" situation, but I suppose it's foolish to complain before trying.
"3. The Division may, in its discretion, refuse to consider a request. "
This isn't a terribly meaningful distinction. There are a dozen+ editing tools out there, most of them are pretty good and free. If Photoshop/Illustrator have 90% of the market because they are superior products, I'm not sure how much the government could/should do.
Apple controls something like 90% of all mobile phone profits across the entire industry. I'm not sure how breaking them would actually provide any consumer benefit.
Profits don't have anything to do with it though. Apple has sub-50% market share. Competition in the mobile space is so competitive there are few profits to be had.
This isn't the first time Adobe has done this and won't be the last.
So Adobe acquiring Figma isn't unlawful, until it is proven to have a bad effect on consumers.
I think what parent is saying, is that we should adjust laws to be more pro-active, that if there is a possibility/high-risk of the acquisition to have a bad effect on consumers, it should maybe be considered a bit more than usual.
[1]: https://www.ftc.gov/advice-guidance/competition-guidance/gui... [2]: https://www.justice.gov/atr/horizontal-merger-guidelines-081...
If you were a founder and wanted to sell your company, would you want the government telling you that you can’t sell it for the best price?
If you prevent such purchases, you eliminate a major factor in creating the value to begin with.
Most non profits have plenty of paid staff.
In fact, there is a Ted Talk about non profits and why their employees should get paid well.
https://www.ted.com/talks/dan_pallotta_the_way_we_think_abou...
I feel most VC blurbs disagree with that, although of course that’s not their actual motivation.
I don’t see how non-profits are relevant other than as examples of companies/organizations that do actually provide value in lieu of massive gains and profit.
And I think you missed my point as I was responding to:
> If you prevent such purchases, you eliminate a major factor in creating the value to begin with.
Anti-trust laws are similar.
> If you prevent such purchases, you eliminate a major factor in creating the value to begin with.
You're basically saying that they wouldn't have made Figma if they'd only been able to sell it for 15 billion.
Same tired argument as the "unless you lower taxes on the wealthiest even more, they'll stop creating jobs!" (Even though the taxes haven't been lower in history than they are right now).
People do stuff even though there are anti-trust laws limiting how many tens of billions they get out of it.
As long as there's insane profits to be made, there'll still be an incentive.
Selling out to the market leader, creating a virtual monopoly that harms the consumers in the long run, isn't the only way to make money on a start-up. Far from it.
I'm pretty wary of monopoly abuse. But I'm also very wary of entitled people (including myself sometimes) demanding that somebody else has the responsibility to create great stuff for free to make their life better. It's beyond my ability to create an amazing electric vehicle so somebody else should be required to do it and give it to me for free or else it is an anti-trust violation. Somebody else should make something as good or better than SolidWorks or Fusion or XD for free or else AutoDesk/Adobe/MS/Alphabet/... are harmful monopolists.
I don't like Adobe or AutoDesk or MS or Meta or many others companies. I disagree with many of their behaviors for various reasons. I think some of what they do is or should be illegal. But I think misguided consumption is more often the root problem. And it is a mistake to punish those who take advantage of misguided consumption in a way that encourages more misguided consumption and entitlement.
But I'm very glad they generated income for their shareholders.
It's fine if a company like Figma takes VC to build a good product that fills a niche that hasn't been explored before and uses the VC to grow and eventually exit to the general public market so that the investors get their return.
It's not fine if larger companies like Adobe can simply swoop in and pay billions to get rid of a competitor, although that one should be dealt with by anti-trust agencies anyway.
It's not fine if a company like Uber uses cheap VC money to price-dump against essential services - and yes, taxis are essential for those without a car, and the anti-discrimination frameworks make sure that access to them is fairly available to everyone, no matter why they would need a taxi for. Uber, in contrast, routinely got associated with everything from wage dumping over racism [1] to extorting people with excessive surge charges [2].
It's not fine if a company like AirBnB uses cheap VC money to wreak havoc on local rental markets [3][4] or to run effectively hotel-like operations in residential zones, while conveniently ignoring things such as fire codes [5], neighbors' quality of life [6], taxes [7] or that people (both guests and hosts) were and are randomly banned for "background checks" [8][9], a return of ages-old banned housing discrimination.
Society definitely needs a hard regulation on anything where VC is involved.
[1] https://venturebeat.com/ai/researchers-find-racial-discrimin...
[2] https://timesofindia.indiatimes.com/business/india-business/...
[3] https://www.tagesspiegel.de/berlin/ferienwohnungen-stehen-le...
[4] https://travelnoire.com/the-airbnb-effect-on-an-already-high...
[5] https://www.nfpa.org/News-and-Research/Publications-and-medi...
[6] https://www.wired.co.uk/article/living-next-to-airbnb-sharin...
[7] https://news.bloombergtax.com/daily-tax-report-state/airbnb-...
[8] https://eu.usatoday.com/story/opinion/policing/spotlight/201...
[9] https://www.airbnbhell.com/banned-from-airbnb-over-backgroun...
https://www.washingtonpost.com/posteverything/wp/2015/07/23/...
If a company could bootstrap their company and grow organically, they wouldn’t need VC funding. By definition any company that is using VC funding is pricing their product less than it takes to make it - ie “price dumping”.
There are already laws about zoning that should keep AirBnB in check. I’m doing the digital nomad thing starting next year. I am specifically avoiding AirBnbs and staying in hotels - mostly mid range extended stays.
There's no reason to replace an already poor service with one that's even worse and requires a smartphone and a bank account, which adds a further layer of discrimination as about 5% of US households don't even have a bank account, much less a credit card, and 24-13% of poorer classes don't have a smartphone [2].
In contrast, a taxi can (at least by law) be used by anyone with cash, and the data about your travel is not available for police or anyone else to abuse [3].
> By definition any company that is using VC funding is pricing their product less than it takes to make it - ie “price dumping”.
IMO, there's a difference between using VC money to provide funds for growth (aka, a high-risk loan) and using VC money to intentionally provide a service at below-cost - five euros for half a hour taxi ride is not sustainable, it won't even pay for the working time of the driver.
> There are already laws about zoning that should keep AirBnB in check.
Yes, now after years and years of issues and complaints. AirBnB could only grow as large as it did by following the "better ask for forgiveness than permission" lifestyle and blatantly breaking all kinds of laws.
[1] https://www.fdic.gov/analysis/household-survey/index.html
[2] https://www.pewresearch.org/fact-tank/2021/06/22/digital-div...
[3] https://www.vice.com/en/article/mbqq7y/is-uber-doing-enough-...
At least I as a minority don’t have to worry about a taxi cab bypassing me when I take an Uber.
Taxi companies have been breaking laws for decades against discrimination and don’t get me started about the government monopoly in regards to the medallion system in major cities.
Taxis should be available for everyone, not just the 85% that own a smartphone and don't end up banned by the app out of random [1].
That existing taxi companies don't follow up to the regulations is a different problem (and one where the government definitely has to step up), but Uber and friends aren't even required to follow the same rules, that is the whole point of why these kind of services are so dangerous for society!
These laws and regulations are, I admit that, often sparsely enforced and most people don't complain anyway, which makes the problem worse as it isn't quantified and shows up on the statistics that politicians and activist groups use either. A lack of data is the single biggest issue in fighting discrimination!
The solution however is not to promote apps like Uber, to which taxicab regulations do not apply at all (or severely restricted) and which just a few weeks ago entered a multi-million dollar settlement for over 65.000 cases of discrimination because they violated the one law that actually is enforced [2].
[1] search for "taxi" on https://www.ada.gov/enforce_current.htm
[2] https://www.justice.gov/opa/pr/uber-commits-changes-and-pays...
They did not. Uber also got caught discriminating against people.
> But you believe that the government will get it right next time?
I have more faith in government than in private companies which have a massive financial interest in saving the money that compliance with anti-discrimination regulation costs.
Traditionally, when a product doesn't want to be lost, the customers will pool their resources together and offer a buyout. That seemingly didn't happen, so Adobe probably is the next best thing. Adobe is a public company, so the public still has the ability to shape its future.
Donate it to the Earth. https://www.patagonia.com/ownership/
A company like figma could have always just gone public if the founders/investors just wanted to get out.
The company has gone public (or will shortly) and is now at the mercy of the public shareholder. Which is specifically the concern here. The worry is that the public shareholders, who aren't necessarily users and are only shareholders out of interest in profit, will see more value in squashing the product than carrying on.
The users pooling resources would have been the logical buyer, to keep out of the general public with competing interest's hands, but seemingly they didn't want the company, so...
> What would the alternative be? There will always come a day when founders and investors want to move on.
Going public means you can move on and sell your shares at any time on the open market, they never needed Adobe to buy them out except to get a higher valuation.
Your original comment implied that if companies like Adobe weren’t able to buy out smaller competitors, the products would just die, which, obviously isn’t even the case here.
The problem with shareholders made up of the general public is that they aren't interested in the product itself. It it goes by the wayside, oh well. They never used it in the first place. This doesn't serve to protect the offering in the manner the customer expects. It might work out, but often it doesn't. Adobe's products themselves are a prime example of what happens when the general public has more say than the users. No user-controlled company would play those shenanigans, but the general public doesn't use Adobe products, so they don't feel the pain. They only see the profit pleasure.
This is why, traditionally, customers who want to ensure that a product remains aligned with their expectations pool their resources and enact a buyout before it reaches the hands of outsiders with other ideas. This allows them to put priority on the product itself, not competing concerns like profitability. But there is no evidence that happened here, so they decided it was okay to let it go to the whims of the rest of the world.
It's a tradeoff. Such is life.
>we need new antitrust laws that are a bit more proactive when it comes to super-massive companies like Adobe
> What do you think happens to VC investments when it’s harder for companies to be acquired?
> maybe a culture of creating small companies out of VC capital only to be acquired by megacorps is not the best way forward for society
> What would the alternative be? There will always come a day when founders and investors want to move on
> A company like figma could have always just gone public if the founders/investors just wanted to get out
The whole point was that anti trust should be stepping in more, and then people were making over the top claims about there being no alternative.
The whole point is that it is not up to the public shareholders to sell to whoever they want if the government will block the sale.
Nobody said such a thing. I did ask what the alternative is. Going public isn't an alternative. That's what is happening. Figma is being transferred into a public trust. And that is the worry expressed with respect to its future, because the general public has no reason to care about the product and will not act in the interest of the product.
Anti-trust could, in theory, do more to prevent the general public from not caring about the product they control. The problem is that laws (where Figma and Adobe are located) are prescribed by the very same general public, so you have to convince them its a good idea. And if you've done that, the law becomes largely superfluous because at that point they're already on board and will act as such on their own accord.
This is what you wrote in response to the idea that anti trust should be used to block these kinds of buy outs.
> The problem is that laws are prescribed by the very same general public, so you have to convince them its a good idea. And if you've done that, the law becomes largely superfluous because at that point they're already on board and will act as such on their own accord.
That is frankly an absurd oversimplification. Shareholders are a miniscule subset of the general public.
You mean shareholders of Adobe? Sure. But the rest of the population see how it applies to their own shareholdings. According to Gallop polling earlier this year, 58% of Americans own stock. I speculate you'll find even more owning stock indirectly (pensions, etc.).
Or do you mean in other countries? America certainly ranks much higher than many other countries with regards to what portion of the general public are interested in such matters. Which is no doubt why it is more relaxed about such things. This probably wouldn't fly in many other countries, but those countries are not where this is taking place.
So yes, I do mean the US. I’ll reiterate: it is absurd to imply that “the public” in reference to shareholders is somehow synonymous with “the public” in reference to voters in America.
You don't need it to be representative, just to form majority. 51% is more than sufficient. 58% provides a healthy margin.
> The fact that 58% of Americans own a share does not imply that they are shareholders of every single one of the ~6,000 companies listed on the public markets in the US.
Should it imply it? I don't see the relevance.
> Further, 10% of Americans hold 89% of the stocks in the US, and therefore as many voting shares.
Fun fact, I guess. I don't see the relevance here either.
Unless you're suggesting that 10% of the population is more likely to speak to representatives on the regular, not hide behind a computer on HN all day while assuming their representative is a mind reader, thus being disproportionally represented? I could definitely see that being true based on my anecdotal observations, although I lack the data to confirm.
> it is absurd to imply that “the public” in reference to shareholders is somehow synonymous with “the public” in reference to voters in America.
If you make the false assumption that the public requires 100% support to do anything. Back in the real world...
> If you make the false assumption that the public requires 100% support to do anything.
You’re sitting here complaining about not being perfectly understood over and over and yet here you claim I said 100% support is required. I said one group isn’t representative of the other, ie it’s interests are not reflective of the pother groups interests.
> You don't need it to be representative, just to form majority. 51% is more than sufficient. 58% provides a healthy margin.
Assuming 88% of that 58% are in actually in agreement.
> Should it imply it? I don't see the relevance.
You made the argument that the shareholders of one public company are somehow functionally equivalent to the public at large:
> Anti-trust could, in theory, do more to prevent the general public from not caring about the product they control. The problem is that laws (where Figma and Adobe are located) are prescribed by the very same general public, so you have to convince them its a good idea. And if you've done that, the law becomes largely superfluous because at that point they're already on board and will act as such on their own accord.
Your position is basically: we already live in an anarchy capitalist society with extra cruft.
Uh huh. The public that directs the government have jobs and have to live in society, so they are quite concerned about these things. The public might also be concerned about the future of Figma, but other comments suggest that they won't be. And I tend to agree as it is a fairly niche product. If something like Microsoft/Windows, which almost everyone uses, was being sold to Adobe it might draw more questions from the public.
> Assuming 88% of that 58% are in actually in agreement.
For sure. They often don't agree. Just as we are only speculating that Figma is destined to disappear here. The public that holds control might decide it's the greatest thing since slice bread and make it Adobe's flagship product. The future is uncertain. I'm surprised you didn't already know that.
> You made the argument that the shareholders of one public company are somehow functionally equivalent to the public at large
You must be replying to the wrong person. Careful which button you press.
> Your position is basically: we already live in an anarchy capitalist society with extra cruft.
Quite the opposite. The public very much coordinates centrally. We just got finished talking about 51% being significant because of that centralization... Replying to the wrong thread confirmed. I hope you find your way back to where you wanted to be.
Also, Adobe can invest money in a product without going to the public markets for more money or taking out loans.
If anyone can buy stock in a company, that means any entity can come along with deep enough pockets and buy a controlling interest unless the founder has enough clout to keep a majority of voting shares.
Your imagination can't be this limited?
Are you really not able to come up with any other scenario than "bought up by your biggest competitor"?
Like...they could go public, or sell to a new owner that isn't already the biggest in the field, etc.
That's the option that has been chosen. That is not an alternative. The product will soon be in the hands of the public. That's also the worry as the public doesn't care about the product and thus won't put the product's interest in mind.
> or sell to a new owner that isn't already the biggest in the field
That's not really an alternative either with respect to the discussion about the new owners potentially letting the product languish or die. It is different, but still reaches the same outcome, potentially. You are still risking that the owner doesn't care about the product.
As discussed, selling to the customers would mitigate this, as they have reason to care about the product, but we already established that they didn't express interest. We would never want to force someone into owning it.
> Your imagination can't be this limited?
It is. Hopefully someone with an imagination will come along at some point. I'm quite interested to hear about alternatives.
You didn’t think they were doing it for the good of society?
Once any founder accepts VC funding, all of the talk about “vision” and “impact on society is also null and void”
What’s the better alternative? That it never existed?
Going public should be the norm, not being bough by a monopolist, otherwise the entire premise of what makes capitalism desirable is broken.