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The UK\u2019s competition watchdog has concluded its initial investigation into Adobe\u2019s $20 billion acquisition of cloud-based product design platform Figma, warning that the merger could cause a \u201csubstantial lessening of competition\u201d for UK designers by removing a \u201csignificant competitive threat to Adobe\u201d from the market. The Competition and Markets Authority announced on Friday that unless Adobe or Figma can offer \u201cacceptable undertakings\u201d to address its concerns by July 7th, the acquisition will be subject to a deeper investigation that risks derailing the deal entirely.<\/p>\n<\/div>\n
\u201cWe\u2019re worried this deal could stifle innovation and lead to higher costs for companies that rely on Figma and Adobe\u2019s digital tools \u2014 as they cease to compete to provide customers with new and better products,\u201d said Sorcha O\u2019Carroll, senior mergers director at the CMA. \u201cUnless Adobe can put forward viable solutions to our concerns in the coming days, we will move to a more in-depth investigation.\u201d<\/p>\n<\/div>\n
Both companies have argued that Adobe isn\u2019t a significant competitor to Figma<\/p>\n<\/div>\n<\/div>\n
According to the summary of the CMA\u2019s decision<\/a>, both parties of the merger argued that Adobe isn\u2019t a significant competitor to Figma in the all-in-one product design software market. The CMA acknowledged within its findings that Adobe had \u201csignificantly reduced investment\u201d into the company\u2019s own dedicated product design application, Adobe XD<\/a>, prior to the merger but expressed concern that the software remains \u201cone of only a limited number of close alternatives to Figma\u201d alongside services like Sketch<\/a>.\u00a0<\/p>\n<\/div>\n