Mid-range accounting vendors fight back

It’s very easy to be distracted by industry buzz and publicity about the Next Big Thing in technology. For the past year or two, everyone’s been focusing on the rise of cloud accounting systems such as Xero, FreeAgent and Kashflow.

But in reality, the pace of change lags behind the hype and the vast majority of software users are running applications they bought several years ago. Last August, we considered the most recent Sage 50 Accounts and QuickBooks Enterprise upgrades. This article looks into the mid-market sector, which continues to be dominated by same three names that have been around for several years: Pegasus, IRIS Exchequer and Access.

Log in to AccountingWEB to find out what the big three mid-market players have been up to during recent months.

  • Pegasus - The RTI factor
  • IRIS Exchequer - Going mobile
  • Access - If you can’t beat ‘em, join ‘em

Stuart Anderson, sales and marketing director at Pegasus, summarised a view that could equally apply to his rivals: “We are always looking at the landscape to see how new and emerging areas such as cloud stand to benefit our customers, and indeed, the extent to which they are gaining traction.”

The cloud is a potential threat to this sector, but to ensure the upstarts don’t disrupt them too much, each of the players has been adapting its systems to see them off. Hosting mature accounting solutions (and associated office productivity programs) is increasingly popular among users, which gives them the convenience of web-based tools, but retains the functionality to which they are accustomed.

Continued...

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Comments

Complexity ceiling.

AlanBourke | | Permalink

Seems to be true enough in most cases at the minute, and might well continue to be the case until HTML5 is widespread. But what about something like OpenERP in this discussion? 

Cloud, thanks but no thanks

coland | | Permalink

As an Opera 3 user well pleased with what Pegasus has provided. Others such as Iris keep attempting to frighten users into a series of seminars whilst Pegasus has quietly got on with the job.

Cloud is fine if you can rely on constant connection; sadly there are always those with compressors & drills to interrupt connectivity. One's onsite facility is a prime necessity!

bencooper's picture

Eastleigh beckons for mid range vendors!

bencooper | | Permalink

I would suggest that the mid range vendors should all be in Eastleigh today as they would make superb politicians given some of these responses.

The fact is these boys have been caught napping and dismissed the cloud early on - something which has come back to bite them now as hoards of customers leave in search of genuinely new technology.

(Print and frame this bit as it rarely happens) I agree with Paul Sparkes that there is currently a ceiling in the cloud market functionality but (and here is where reality kicks back in) dismissing this as a long term situation is a fools errand. Unlike the legacy on premise solutions the cloud market is youthful, energetic and agile; it will change, quickly and new functionality will appear every 4-6 weeks, something Iris, Access etc can only dream of delivering.

It is hard to blame the on premise vendors for getting themselves into this position. They have become used to their maintenance base and it is very hard to wean yourself from a cash cow like this. However, I fear that many have left it too late and now that the pressure is on they realise how hard it will be to re engineer their old architecture onto a viable cloud platform. Instead we see these token gestures or small elements of web/cloud based functionality - which dont really offer clients the same flexibile solution.

In 2012 we undertook our first search and selection project where the client specified Cloud only. We were worried that the market was not ready, especially given some of the complexities of the clients requirements. However we were pleasantly surprised by the outcome.

As this article points out many people consider the cloud market to be limited to the book keeping solutions from Free Agent, Quickbooks and Xero - but that belittles a maturing market. Solutions such as Netsuite, XLedger, SAP BBD, Aqilla, Brightpearl and Financial Force are offering a true alternative to the sleeping giants.

I know the mid range vendors will put a pretty dress on their solutions which some customers will accept as an improvement, but it is not a long term solution. I really do like a lot of the on premise solutions and would suggest their time/money might be better spent on re engineering their established and functionally rich products into true cloud solutions as I think the market would be a better place for it.

I don't think hordes of

AlanBourke | | Permalink

I don't think hordes of customers are leaving just yet. Also 'the cloud' is an annoyingly fuzzy heading that encompasses more than just browser-based applications - running the normal 'desktop' versions of current products on a server in a bunker somewhere and accessing them over the internet via RDP is 'cloud' too.

I'm sure a day will come where fast broadband is ubiquitous and almost 100% resilient, and cloud platforms are almost 100% resilient (you will remember to renew your Azure certs, won't you Microsoft), and HTML5 or whatever allows the creation of a UI as rich as can be achieved in .NET or Swing or whatever. Until it does we'll be in a halfway world.

 

bencooper's picture

Conveniently forgotten

bencooper | | Permalink

"'I'm sure a day will come where fast broadband is ubiquitous and almost 100% resilient, and cloud platforms are almost 100% resilient (you will remember to renew your Azure certs, won't you Microsoft)"

I love the way in which everyone has conveniently forgotten the times their servers fell over or they had a power cut in their offices and all the staff sat around looking at each other. Ultimately nothing is 100% assured in terms of up time, be that on premise or web based. This is such an old arguement against web based or cloud solutions and one we really should stop trotting out

Thanks though Alan for pointing out my erorr on the broad use of the term Cloud, you are correct about hybrid solutions. However, this is ultimately not new technology just deployment.

 

Yep, power cuts, and the

AlanBourke | | Permalink

Yep, power cuts, and the accounts software data usually ended up mangled!

There's definitely a perception hurdle to overcome, especially with things like payroll in small enterprises. They would need a lot of convincing that there is no chance that when Madge or Bill come to run the hosted payroll last thing on a Friday to make sure it hits the bank, that they have a way out if the internet goes down.

bencooper's picture

POETS

bencooper | | Permalink

Then give them a POETS day and send them home early to do the payroll from there where they do have internet.

ah now you see, you could not do that with a corrupted server!

And where would they print

AlanBourke | | Permalink

And where would they print 500 dot-matrix payslips to at home? Or would they be printing directly from their hosted payroll application anyway? :)

 

 

bencooper's picture

another new technology

bencooper | | Permalink

AlanBourke wrote:

And where would they print 500 dot-matrix payslips to at home? Or would they be printing directly from their hosted payroll application anyway? :)

 

 

 

Alan I hate to chuck more new technology at you but have you come across email....?

Name rings a bell LOL  

AlanBourke | | Permalink

Name rings a bell LOL

 

timfouracre's picture

Mid-range accounting vendors are dinosaurs...

timfouracre | | Permalink

John, you forgot to mention Clear Books in your list of rising cloud accounting systems, but I digress!

Simply, the cloud is the Internet.

There is a technological shift underway from desktop software to the community, collaboration and commerce of online applications.

Businesses are increasingly adopting the cloud not just for accounting or payroll software. They are doing everything online.

Email, storage, marketing on Facebook, Twitter, Linkedin, research on Google. Even spreadsheets, documents and presentations with Google Docs. Your own corporate website is part of the cloud. Networking with customers, suppliers, prospects. Even networking with peers on AccountingWeb is in the cloud.

We are in the age of the Internet so if mid-range accounting vendors do not embrace the cloud they are not fighting back. 

Mid-range accounting vendors are dinosaurs and we all know what happened to the dinosaurs...

 

And are the bulk of their

AlanBourke | | Permalink

And are the bulk of their customer bases crying out for it? I suspect not, at the moment anyway.