Adobe Extends Video Software Offerings with Acquisition of Serious Magic

PRESS RELEASE

Future Adobe Products Set to Gain from Integration of Award-Winning Video Technologies

SAN JOSE, Calif. — Oct. 19, 2006 — Adobe Systems Incorporated (Nasdaq:ADBE) today announced it has acquired Serious Magic Inc.™, maker of video software and communications tools for creative professional, business, consumer, and education markets. With Serious Magic solutions such as DV Rack extending direct-to-disk recording and monitoring into the field and Visual Communicator and Vlog It™ delivering the power of video communication to general business users and casual bloggers, the acquisition strengthens Adobe’s leadership position in video software — for both video professionals and consumers.

“The huge momentum behind Flash® Video, which is powering everything from online TV shows to YouTube and MySpace, is turbo-charging Adobe’s video business,” said John Loiacono, senior vice president of Creative Solutions Business Unit at Adobe. “The purchase of Serious Magic accelerates our vision to make, not just video but all dynamic media, an even more ubiquitous communications vehicle, whether you’re delivering content for the broadcast market, over the web or on mobile devices.”

Adobe plans to continue to sell Serious Magic’s products and future versions of Adobe’s video solutions will include Serious Magic technologies and software. Terms of the acquisition were not disclosed.

“Adobe video products and Flash Video are creating new ways to integrate the moving image into almost every imaginable communication project,” said Mark Randall, CEO and Chief Magician at Serious Magic. “We’re proud of the cutting-edge work we’ve done at Serious Magic and believe that teaming with Adobe will be a truly magical combination enabling our award-winning technologies to have a lasting impact on video communications.”

Randall, a twenty-year video industry veteran, will join Adobe as chief strategist, Dynamic Media.

Serious Magic is a privately held company headquartered in Folsom, California and currently ships several widely-acclaimed products, including DV Rack, ULTRA™ 2, Ovation™, Visual Communicator and Vlog It. Adobe believes this acquisition will not have a material financial impact on the company.

Forward Looking Statements Disclosure
This press release contains forward looking statements, including those related to future product development plans, which involve risks and uncertainties that could cause actual results to differ materially. For a discussion of these and other risks and uncertainties, individuals should refer to Adobe’s SEC filings. Adobe does not undertake an obligation to update forward looking statements.

About Adobe Systems Incorporated
Adobe revolutionizes how the world engages with ideas and information - anytime, anywhere and through any medium. For more information, visit www.adobe.com .