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Adobe currently earns most of its revenues through the sale of software that runs locally on a computer's hard drive, but has recently started to offer selected applications online as a service.

As part of the switch it recently acquired Virtual Ubiquity, the company responsible for creating the Buzzword online word processor.

Speaking at the Web 2.0 Summit in San Francisco, Adobe chief executive Bruce Chizen said running software on the desktop is still optimal for

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most of its customers, but that the company expected the situation to change over time.

"The desktop is a powerful, powerful machine in which to run applications. Broadband, as quick as it gets, is still going to have some limitations in the short term," said Chizen in a question-and-answer session on stage at the conference.

Chizen answered a question about whether a complete shift to web delivery would take five or 10 years and he indicated it would be closer to a decade.

Like many traditional software makers, Adobe must fend off rivals delivering competing, often free, applications over the web, an industry that has exploded in the last year.

Adobe has already started introducing bare-bones versions of its design tools for free including Photoshop Express, which lets users edit photos online. It also has a free video editing tool called Premiere Express.

These products are designed to appeal to a younger generation of internet users for whom paying $400 for a packaged software product is a thing of the past, say Adobe officials.