Adobe Systems, Inc. on Friday announced it is acqiring arch-rival Macromedia, Inc. in an all stock transaction valued at approximately $3.4 billion.

The two companies had previously been locked in a bitter rivalry in the creative professional software market. Adobe, best known for its Photoshop image manipulation and Acrobat digital document software, said the move would help it offer audio and video solutions more tailored to the mobile media market. The acquisition gives it access to Macromedia’s hugely popular Flash software, which is used to deliver animation and video on the Web.

Under the terms of the deal, Macromedia shareholders will get 0.69 share of Adobe, worth $41.86 at Adobe’s closing price of $60.66 on Friday on Nasdaq, for each Macromedia share. That is a 25 percent premium to Macromedia’s closing price of $33.45 on Friday, also on Nasdaq.

Chizen will stay in his position as CEO, Adobe said, while Macromedia President and CEO Stephen Elop will become president of worldwide field operations at the combined company.

The deal is expected to be completed this Autumn.

Microsoft on Tuesday released its April package of secrity updates for Windows. The updates include patches for five security vulnerabilites that Microsoft had rated ‘critical,’ its highest security flaw rating. Microsoft also released patches for their AntiSpyware tool as well as fixes for Exchange Server 2003 and Office 2003. All fixes are available from their usual locations; Windows fixes from Windows Update, office fixes from Office Update.

In related news, Microsoft also disabled a utility that allowed businesses to delay the rollout of Windows XP Service Pack 2 via Microsoft’s Automatic Updates feature. The utility was designed to give mid-to-large enterprises time to test SP2 on their systems before rolling it out across their wider networks.

I’m sure you’ve seen the news by now about Apple ending Mac development. Bummer, I know. It certainly puts a damper on my enthusiasm toward Tiger’s release. But I knew this day was coming, eventually, so I installed Virtual PC and am now becoming aquatinted with the joys of XP. It actually isn’t that bad of an operating system. In fact, it kicks Panther’s ass and even Tiger’s for that matter. And Luna isn’t really as putrid as I remember it being; it grows on you after a while.

It won’t be all bad. After all, Apple computers will still be available, they just won’t run the Mac OS. And if you consider the size of the Windows market, you realize that this move makes sense and that Steve Jobs is a genius.

After months of wrangling and numerous failed attempts, Microsoft has finally settled on names for its new versions of Windows XP. The new versions, called Windows XP Professional N and Windows XP Home Edition N are identical to their respective predecessors in every way except one: they will ship without Windows Media Player preinstalled.

Both versions of Windows XP N will be available on store shelves in Europe only, as they are the result of Microsoft’s efforts to comply with a recent European Union ruling against them, mandating that they ship a version of Windows XP with no bundled media player.

Earlier this year, Microsoft said it was working with the commission on naming options after antitrust regulators balked at the “reduced media” name. Microsoft said the name was selected by European regulators over nine other alternatives proposed by the software maker.

“We have some misgivings about the chosen name as we fear it may cause confusion,” Microsoft spokeswoman Stacy Drake said on Monday. “We will adopt the commission’s name in order to move forward and accelerate the pace of the implementation process.”

The ruling stemmed from an EU anti-trust investigation into Microsoft’s business practices with regard to its Operating System and Server products.

Well, not quite - according to The Inquirer, Microsoft will allow people with existing 32bit versions of Windows and a 64bit-capable x86 Processor to exchange their licence for a 64bit one, which they can then download from the MS website.

That’s a very generous move IMO