Why are we still dependant on Camera Raw to get Smart Objects?

I've been a professional user of both Photoshop and Lightroom since they were created and feel that I'm either missing something simple or maybe just asking too much, but can someone from the engineering team please tell me why we still have to rely on Camera Raw plugins to open the file either directly or as a Smart Object into Photoshop?
It would seem to me that Lightroom should be able to handle the round-trip conversion from Lightroom files to Photoshop Smart Objects and any future edits back in Lightroom. The only reason I can honestly see for the reliance on Camera Raw is to keep us upgrading Photoshop - something I'm sure Adobe would like us to do on a regular basis but in the current economic climate is not always possible.
I want to keep updating Lightroom to ensure the best possible conversions for my clients but don't see why I have to keep upgrading Photoshop to keep Camera Raw up to date when CS5 does everything I currently does everything I currently need. Maybe I'll be proven wrong but I'm guessing this is the way we're heading with the release of Camera Raw 7 along with Lightroom 4. Please tell me if I'm wrong!

Jason Replica wrote:
Situation 2 - Current Situation
We have Photoshop and compatible versions of Camera Raw and Lightroom installed.
I can open a raw image from Lightroom into Photoshop using the "Open in Photoshop as Smart Object" option.
This works fine but when I double-click on the Smart Object it opens back in Camera Raw for editing.
I'd always presumed that Lightroom carried out the conversion rather than Camera Raw in this situation before handing off the data to Photoshop to form the Smart Object. Have I been incorrect in my presumption?
That's where your assumption was wrong...as long as LR & ACR is in lockstep, LR hands off the image to ACR. An ACR Smart Object needs to use ACR to allow editing of the SO. That is a function of ACR and Photoshop. Lightroom can't do a SO because, well, SO's are a function of Photoshop, not Lightroom.
Jason Replica wrote:
Situation 3 - Future Situation - Maybe??
We have Photoshop and Lightroom installed.
I can open a raw image from Lightroom into Photoshop using the "Open in Photoshop as Smart Object" option.
This doesn't rely on Camera Raw to hand-off the data to Photoshop and form the Smart Object as Lightroom is capable of the same type of conversion on it's own. Double-clicking on the Smart Object should then re-open the image in Lightroom (as that's where it came from originally) and allow all the editing that we've come to expect in Lightroom.
Ain't gonna happen because Lightroom can't handle the Photoshop Smart Object SDK...and since the actual rendering of ACR/LR is the same (for the same version) it's a moot point.
Jason Replica wrote:
Ignoring the economics of having to update Photoshop as I know Adobe (and probably Jeff as well ) would like us all to be running the latest version of Photoshop and payout for the updates as soon as they come around, I would think this would be a more sensible option for the future as it would allow more people to keep their existing version of Photoshop, which they've tweaked, wrote actions for and is working very nicely at the moment thankyou while exploring the benefits of the new-and-improved Lightroom.
I really don't have a dog in this hunt–obviously, I always upgrade the moment an upgrade is available...but there are technical limitations (see above) that preclude what you think you want. As far as the economics, a $99 LR upgrade and a $199 Photoshop upgrade ever two years doesn't seem to be a huge hurdle. Add up the LR & PS upgrades and you get a cost of about $12.50/month over the 24 months...yes, it's an added cost but if you want the best user experience and usability it makes sense to keep LR & Photoshop/ACR in sync. You aren't FORCED to upgrade Photoshop...LR4 will work as far back as Photoshop CS3 (not sure about CS2). But then you are locked into the LR processed approach because older versions of ACR can't process the newer versions of LR processing controls.

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