Back in May’13, Adobe, one of the few remaining bastions for packaged enterprise software, had announced that it would stop offering its Creative Suite (which includes products such as Photoshop, Illustrator and Acrobat amongst others) by the end of this year. The company announced at the time that it was doubling down on Creative Cloud, a service that offered users the same products via a monthly subscription. Well, last week, Adobe announced the results for its latest quarter, which showed that Creative Cloud had more than 1 million subscribers and annual recurring revenues of $546 million, representing an approx. 50% quarter-over-quarter increase in its cloud user base. The packaged software Creative Suite has in the past represented approximately half of Adobe’s $4 billion annual revenues, or $2 billion. Thus Creative Cloud is still only a quarter of its packaged software predecessor, but with a strong growth rate.

Adobe’s decision to rapidly move away from packaged software and into the cloud was quite a gutsy one, since it was undertaking this transition for nothing less than its flagship product. Aside from Microsoft, Adobe had been the flag-bearer for packaged software sales, but to the company’s credit, its understanding of its user-base’s pulse was correct, and adoption of Creative Cloud has been rapid. Furthermore, the move to the cloud is enabling Adobe to understand its user-base in ways it couldn’t before. The company can now fine-tune pricing tiers and application bundles to optimize its revenues around consumer willingness to pay. Also, by including 20 GB of storage with the SaaS offering, Adobe now gets to segment its subscribers around usage levels and use-cases, gaining insights that it never may have had before. All this paves the way for Adobe to truly own the large designer community that it is the lifeblood for, and all while simplifying feature-control and customer-support operations for the company.

During a week when another ex-behemoth Blackberry was in the news for the wrong reasons, it was refreshing to see Adobe achieve partial success as it embraces the cloud business model for its flagship product. Looking forward to a world where Photoshop for the masses becomes a reality, if only for the reason that there is a creative person within every one of us!

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Last week, the NoSQL database space saw a couple of interesting new announcements: First, Couchbase announced a new, mobile-focused database called Couchbase Lite. With Couchbase Lite, app developers can natively use the database on the mobile device to enhance user experience as well as to enable more comprehensive syncing of app-states across mobile devices (a la Dropstore API). Second, Amazon announced a local version of its own DynamoDB database, which can be used for offline development of applications before the developer goes live on AWS. Couchbase and DynamoDB are both key-value store databases that offer low latency/high throughput, but with limited feature-sets around understanding the underlying data itself (Couchbase 2.0 does get closer to being a document store).

As compute power in mobile devices continues to grow, it makes sense to have more and more data around the app reside on the mobile device. In that context, a key-value store such as Couchbase Lite might have the best shot of all the NoSQL flavors to find immediate use cases in mobile – other flavors such as column stores and document stores, being more feature rich and with higher latency, may find it harder to make headway in the near term. Couchbase Lite should thus help the company improve its competitive position in the NoSQL market that currently sees MongoDB as the leader.

As for DynamoDB’s local version, while the stated objective is to simplify app development and deployment, the bigger goal is probably for Amazon to use DynamoDB to get a foothold in the private or hybrid cloud and/or to move beyond IaaS and into PaaS. Either ways, this should help DynamoDB get increased adoption within the developer community and further muddy the NoSQL landscape

Last week’s announcements suggest that whether it’s content consumption or app development, compute might be moving back just a little bit from the cloud to the edge device. This means that NoSQL vendors might need to deal with increased diversification in end-points and environments going forward, all while the vendors continue to jostle for market share. Maybe this diversification will be the impetus for consolidation or shake-out in this fragmented space.

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Last week was a busy week for the smartwatch segment. No less than three large corporate entities announced the launch of their individual smartwatches: Samsung (Galaxy Gear), Qualcomm (Toq) and Sony (Smartwatch 2, a sequel to their first version that was launched last year). The Galaxy Gear and the Toq are both priced at $300, whereas the Smartwatch 2 at $200 is closer to the prices of existing smartwatches such as Pebble and Basis ($150 each). Quick feature review: the Samsung Galaxy Gear has a 1.9 MP camera, a speaker/mic, has a 24 hour battery life, and can connect with other Galaxy devices. Neither the Qualcomm Toq and the Sony Smartwatch 2 have a camera or a speaker or a mic, but both have more than 3 days of battery life, and both can connect with Android devices with recent firmware versions. Qualcomm Toq uses its own Mirasol Display.

Smartwatches have in recent times been a polarizing topic for the tech world. We are still in the early adoption phase – while almost 300,000 Pebble watches have been sold so far, the first units were shipped just a few months ago. At the mass-scale, success of the smartwatch would depend on whether it can become its own consumer electronics category, and at a price of $300, that seems unlikely. Beyond being a wrist-watch replacement, the smartwatch is still just an advanced wellness device; features like mics and speakers might be useful but are not sufficient to preclude the need for a smartphone. The high price point will thus make it difficult for a user to justify the purchase of one more mobile gadget, especially given the expectation of rapid evolution in feature-sets and form-factors. Now, if this device were priced in the $100-150 range, the story could be different…

Last week’s news indicate just how low the barrier to entry in the connected device arena is, the upshot being rapid fragmentation in the market. Given this, the best chance at building a successful business in this space might go to the arms dealers – chipset players such as Qualcomm, ARM as well as Opus portfolio company GainSpan, operating systems such as Android, and the contract manufacturers for the devices. For everyone else, it’s a free for all, all while the market decides for itself!

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Shopify, one of the leading providers of online storefronts and payment processing solutions for retailers, last week introduced its own iPad-based  point-of-sale (POS) system for merchants. The company views this new POS system, complete with a card-reader, a receipt printer and a cash register, as something that will enable merchants to manage their online and offline storefronts using a single software platform. Shopify currently has 65,000+ online storefront customers, and its key competitors include Magento (acquired by eBay) and BigCommerce.

A number of Shopify’s customers probably also have a physical presence, so it seems like a natural extension for Shopify to offer a POS with integrated inventory management and transaction processing to its customers. However, the story might not be that simple. Shopify’s selling proposition to customers so far has been its ease of deployment and lower price points compared to competitors – suggesting that its clientele might comprise mostly of small businesses (as opposed to medium or large). One could argue that the greatest need in this segment is the kind of easy-to-use, mobile-friendly card reader pioneered by Square; a bundled POS system (see image) with integrated inventory management, cash registers, receipt printers etc. could be useful, but will probably push Shopify to sell into more the medium/large business segment. In that segment, it might end up in a whole new ballgame, competing with established players like Verifone and NCR. At the same time, Shopify now will need to worry about hardware supply chains, increased customer support needs, and lower margins. Too many dimensions of unfamiliarity for a startup to deal with…

A simpler approach for Shopify might have been to add just the card reader to its product suite, and that too only to defend its turf around payments and storefronts. With the likes of Square, Intuit, Paypal, Groupon and others in the transaction ecosystem, Shopify already has its hands full with tough competitors, and it really did not need to add POS terminals like NCR and Verifone to that list. So, we will see – let’s hope now that fortune favors this brave start-up!

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