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How Adobe’s Acquisition of Magento Affects Oracle

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Acquisition of Magento has made Adobe a prominent competitor to Oracle in e-commerce space

So far in the series, we’ve discussed Adobe’s (ADBE) recent acquisition of Magento and Oracle’s (ORCL) acquisition of DataScience.com.

While Magento ensured Adobe’s entry into the e-commerce space, DataScience.com is expected to give Oracle’s efforts a boost in the AI and machine-learning spaces, which are viewed as two of the fastest-growing segments in the technology sector.

According to a study done by Aheadworks, an industry partner of Magento, WooCommerce and Magento held market shares of 18% and 16%, respectively, in the fragmented web store space in 2017. Oracle ATG Commerce held 16%, while Shopify held 13%. IBM (IBM) and SAP (SAP) were other prominent players, with IBM Web Sphere and SAP Hybris having market shares of 7% and 3%, respectively.

Magento’s prominent presence in the e-commerce space gives Adobe an edge over its peers—especially Oracle, IBM, and SAP.

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Magento will give a leg up to Adobe’s offerings

Over the past few years, Adobe has transitioned from a traditional software licensing business to a subscription-based business in the cloud services market. Through Adobe’s three key business offerings—Creative Cloud, Experience Cloud, and Document Cloud—the company expects its total addressable market to reach $83.0 billion by 2020.

From time to time, Adobe has made strategic acquisitions, including Omniture, Auditude, Day Software, Efficient Frontier, and Neolane, to enhance the functionality and product offerings of its marketing platform. Along these same lines, it acquired TubeMogul for $540 million in 2016 to strengthen its marketing cloud capabilities.

Adobe can now package these services into Magento for its customers, which is not good news for Shopify, Oracle, or other players in the e-commerce and marketing cloud spaces.

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