Trash the terminology?

Great paper by NetSuite & AW. Excellent to see the bright light of common sense illuminating some of the murkier depths of technology! I'm guessing many of the Decision Makers -  ie. the target market who should be picking up the cloud computing ball with shrieks of enthusiasm and running with it, are as new to all its oft confusing terminology as I am. Unlike me however they may not be quite as happy to expose that ignorance.And isn't that the crux of the matter ...

... for all SaaS providers? Doesn't that tell us if we don't trash some of the terminology and translate it into plain English we run the risk of a full blown *ENCS with nobody wanting to stand up and shout. 'Hang on a mo, I don't understand this!' Comments and brickbats welcome - I'm on board to learn.

*Emperor's New Clothes Syndrome!

Comments
John Stokdyk's picture

A recurring theme

John Stokdyk | | Permalink

Thanks for joining the fray and raising what appears to be the crux of the issue for professional accountants. During the past few weeks I've encountered the same issue over and over again:

  • Internet accountancy pioneer Richard Messik stood up at Softworld and asked the assembled Cloud vendors why they couldn't adjust their language to speak to the needs of prospective customers. You can see a video of his query and his subsequent comments in his blog post Clouding the issue.
  • Another AccountingWEB blogger, Ray Backler, picked up the same theme in his post Enlightenment or Fog?
  • I asked six accountants at last week's ICAEW Sole Practitioner's conference if they were planning to move into the Cloud. Only one planned to do so, and out of the other five, two replied, "I have no idea what that is."

As mentioned elsewhere, AccountingWEB is hosting a panel session at next week's Business Cloud Summit to encourage the industry to address the profession's needs and concerns, but we can also tackle the same issues within this group.

I realise that I've probably helped to perpetuate Cloud jargon more than clarify it, but as part of my pennance, I'll try and explain the terminology I currently use. For me, "The Cloud" is a shorthand phrase that refers to an application that is hosted somewhere in the internet and delivered to the user via a normal web browser. There are many variants of this, but few people other than techies are very interested in those differences. The Cloud works well as a headline phrase, but I will also substitute "web-based applications" to describe the concept.

Perhaps as a continuation of this thread, we could put forward a glossary of straightforward accounting terms and the equivalent Cloud phraseology.

To get things started, I'd like to quote from Richard Messik's blog. "If we leave 'selling the cloud' to the vendors, the advantages will get lost in the jargon... The concept is basically very simple.. keep it that way," he argued. Instead, he put forard the following summary of its advantages:

1. It is more flexible
2. It enables 24/7 access - anytime, anywhere.
3. It is generally cheaper
4. It reduces internal infrastructure costs and requirements
5. It facilitates collaboration and
6. It's greener.

Not a bad start, I reckon. Does anybody else have any confusion or pet hates about Cloud technology and terminology that we could tackle in this thread?
_________________________
John Stokdyk, Technology editor

Why is it confusing?

gsgordon | | Permalink

It's confusing because most of the gurus out there (living in their own little cloud?) use too many words to describe "the cloud". They often prefer to talk about how it works rather than what it does. For example, I just read on a well-known site that -

"Cloud computing is broken down into three segments: "applications," "platforms," and "infrastructure." - etc etc."

So, do I need to know there are three segments?  No!

All I need to know is that my data is held securely elsewhere and processed by applications that are maintained elsewhere by somebody else. At the very least, this means (or should mean) I don't need to worry about backing up my data, or about software maintenance. It has the added advantage that I can use any internet connected computer to access my data and have it processed.

There are of course some issues that should be addressed by potential users of cloud computing, one of which is  Information Security. I was interested to find that the European Network and Information Security Agency (ENISA) (an EU agency, as you might have guessed from what follows) has just addressed the issue in -

"ENISA clears the fog on cloud computing security" (at http://www.enisa.europa.eu/media/press-releases/enisa-clears-the-fog-on-...).

They provide links to two reports - "SME Survey on Cloud Computing" and "Cloud Computing Information Assurance Framework", the second sounding rather daunting but it's only 24 pages. Unfortunately, there is another link to "Cloud Computing: Benefits, Risks and Recommendations for Information Security", which sounds like the one to read, but it has 123 pages - talk about clearing the fog!!

I don't know who is going to take on the task of translating the 24 pages, never mind the 123. Maybe I'll return to this when/if I get to the end of it.

Slight catch-22 position

Anonymous | | Permalink

Realistically users do not actually need to know much about Cloud except that it works; in the same way as turning the ignition key on a car makes it go.

However, if one takes this approach everyone would be up in arms because for some reason they feel it necessary to know about the technology. Unfortunately this is the result of the IT industries attempt to de-skill the technology so that everyone can use it irrespective of their understanding the underlying issues - everyone is an instant expert!

The result is information overkill so that the public is fed far more information that they really need

Allied with this the subsequent introduction of the marketing men - which then renders the whole thing completely incomprehensible and becomes JaaS (Jargon as a Service)

A far more important issue is whether you trust your provider not to use the information held on their servers to their own advantage. For instance do they read existing emails passing through their servers or track every search so that your pc can be targeted with 'appropriate' information in future searches etc ...

Disadvantages of Cloud Software

chatman | | Permalink

NOT cheaper

Harder to make your own backups

The above makes it harder to trash your data file of you make a big mistake (eg incorrectly import a large amount of data)

Delay between click/key-press and response

Richard Messik's picture

Disadvantages of Cloud software?

Richard Messik | | Permalink

I don't know what systems you have experienced but I certainly don't recognise any of the negatives you raise.

As for backups most good SaaS systems allow you to export data - if that is what you want to do. The fact that the data is already backed up by the provider must, in itself, be a strong point. Consider all those poor business which have been flooded out in Cumbria. I wonder how many of them had adequate disaster recover plans and offsite data backups. Not many I would wager. Using the Cloud would have dealt with that problem.

As for delays between keyboard and response - not in the 9th year of the new millenium! Comments like that are soooo last century!

 

Disadvantages of Cloud Software

chatman | | Permalink

A basic desktop bookkeeping package such as VT Transaction has a one-off fee of £125 + VAT, and could last for ten years, before one decides to upgrade. Clients can use VT Cashbook for free.  How much would one of your on-line services cost?

Backups: if I want to take a backup of my desktop data file, import some data, then restore the original file, I can do it with a few clicks. It was definitely not that easy when I tried it with an on-line product. In fact, the only backup I could download was called a Sage backup and, although it was in csv format, I could not understand the data, so would have been unable to use it in another programme if my on-line provider had failed.

Running one's ownbackups is easy and free. I accept that it is even easier to have it done for you, but my post is not about the advantages of on-line software, it is about the disadvantages, which seem to be ignored in this article.

Latency: I do not know how you have reached your conclusion, but my experience does not support it.

John Stokdyk's picture

Steady on, lads

John Stokdyk | | Permalink

<ding, ding>

There's nothing I like more than a good, hard fight between people with opposing opinions - but this thread started out grappling with the confusion surrounding Cloud terminology, and you've moved on to the cost and functional benefits.

That's an entirely new can of worms - but one well worth exploring. To try and retain a bit of coherence, I've started up another thread on The Cloud Business case.

If we can corral the discussions into separate areas, we might be able to explore them more deeply - and I'm beginning to think that we could organise some of the material we produce here into briefing documents for AccountingWEB readers.

<ding, ding>Round Three!

Is the Cloud a retrograde step ?........

Anonymous | | Permalink

Richard

As a developer of SaaS systems - however, minimal there is a delay between keyboard and retrieving data; by their very nature browser based apps cannot compete with a desktop response.

Back to thread

You are going to get all manner of 'purists' making a distinction between SaaS and Cloud but quite frankly why does the user need to know - the bottom line is it either works or doesn't

The press and the accountancy profession are some of the worst proponents of all the surrounding jargon - trying to create copy (news) by coming up with ever more obscure phrases

The whole point of these apps is separation between the front end (browser) and back end processing (app & data) - (x tier); that is really all there is to it

Don't forget that any SaaS app can be run entirely on a local computer (XP pro/Windows 7 pro) or alternatively distributed in almost any configuration one chooses (i.e. WebServices). Furthermore, data and code can reside in different places in the world; it makes no difference.

With the above (SaaS comments) in mind the Cloud could actually be regarded as a retrograde step because it forces a grouping of apps & data under a single wrapper rather than allowing the freedom to locate components anywhere

From a development stand point the beauty about the SaaS/Cloud approach is that you only have to target the browser(s) and the underlying operating system is largely irrelevant; so there are no issues to trash your systems when a new OS is released. Also maintanance & release procedures are infinitly simpler, being in one place.

John Stokdyk's picture

Pointed tweet from Xero's Gary Turner

John Stokdyk | | Permalink

Just noticed an interesting little swipe from the direction of Xero UK managing director Gary Turner's Twitter account: "The tech psyche leads to selling by diminishing the value of prior systems; = the result is this so called 'debate'."

Ouch! I'd hate to think that he's trying to dismiss the entire rationale for this discussion group in one sentence. It's a point well made, but while the 140-character Twitter limit tends encourages entertaining aphorisms, I don't think it's very good at exploring nuances. In case you haven't been paying attention, Gary, we have gathered evidence on this thread to show that the Cloud message is not getting through to the accountancy profession and that vendors such as yourself have not found the right language to excite accountants about their products and services.

The point raised in the original Trash the terminology post was not around the functional and generational conflicts taking place between on-premise and on-demand software suppliers. It was more a case of users struggling to find meaningful definitions among all the hype. With such a neat turn of phrase, we'd love to see you join in that discussion here, Gary!
__________________________
John Stokdyk, Technology editor

Why has he said "so-called" and does he know what inverted comma

chatman | | Permalink

Why has he said "so-called" and does he know what inverted commas are for?

garyturner's picture

140 Chars is too limiting

garyturner | | Permalink

OK.

Let me expand; what I meant was - what doesn't contribute to the effort to provide clarity for businesses and accountants (and actually brings more confusion) is the inability of the software community to pull itself out of the war of words being waged by the on premise faction and the cloud faction.

Remove the present factional split and you'll find this is nothing new. The collective brain of the technology industry is hard wired to one way of thinking - that being the only discussion worth having is about how the next version, platform, upgrade or new feature will best the former. Whether the outputs are total cost of ownership (yawn), return on investment (double yawn), productivity, profitability, usability, reliability etc. technology advocates typically have a one track mind. Sadly, this chronic way of thinking and communicating inevitably spirals towards PowerPoint death matches about which framework is better, ad-hominem banter, the real definition of cloud computing and all manner of technological nonsense that is of internal interest only to the tech community and the occasional CIO. And often discredits the whole community.

I think it's possibly more audible these days because of the web and its ability to enable this infighting to be aired in view of customers. I'm sure that equally vociferous discussions took place behind closed doors between the client-server fanbase vs. the Unix community in the late eighties, it's just that AccountingWeb wasn't around back then to host them! - (not suggesting you shouldn't be).

The real discussions should be around helping businesses and accountants solve their problems or expose new opportunities; and while it's tiresome to read yet another half-baked justification for cloud vs. on premise vs. hybrid or any combination of all three, frankly if some vendors are unable to lift their pitches to the level of solving business problems, then the law of natural selection will prevail in favour of those who can. Markets are much smarter than people often give them credit.

PS. To underscore my point -  a free month's subscription to Xero for the first person to find the word 'cloud' or a cloud computing diagram on http://www.xero.com.

Use of "so-called" and inverted commas

chatman | | Permalink

My question still stands.

The reason I asked it was because the Twitter comment appeared to imply that a debate was attempted, but that it had failed. No attempt was made to justify the comment, so I wondered whether there was any justification or whether someone was simply throwing their toys out of the pram at a preceived attack on their product. I assume it was the latter.

garyturner's picture

Use of "so-called" and inverted commas

garyturner | | Permalink

What I attempted to say in my prior comment (and the reason for naughtily using inverted commas for emphasis in my original tweet) was that the debate was not legitimate to the extent as it seems to bog down in technicalities, ad hominem jibes (of which I note that I am now a recipient, thank you) and tech jargon rather than bringing clarity to the commercial benefits.

By all means have two debates, one where the tech community can blow its brains out and another more meaningful discussion about how businesses and accountants can change, adapt and grow their organisations with great tools, whether they be old or new - Excel doesn't seem to be going out of fashion any time soon.

I doubt we can get there, though.

John Stokdyk's picture

Give the man a break!

John Stokdyk | | Permalink

OK, chatman - I accept that this thread IS all about semantics and definitions, but I think you've gone a bit far in ascribing so much import to where Gary placed his inverted commas.

Though you are correct in pointing out the inherent redundancy, using inverted commas to infer an extra meaning is a lazy and imprecise use of punctuation. Inverted commas should more accurately be used to indicate that he is quoting a comment by someone else. So I would argue that so-called debate (without quotes) would have been the preferable usage.

Getting on to the slant of Gary's tweet, I understood it to be a snipe at the staged and sterile aguments that take place between software marketing people and commentators... My pained reaction was based on the feeling that Gary hard tarred this discussion group and thread with that brush. Having invited him to expand on his comment, I'm perfectly satisfied that he has done so in a robust, entertaining and enlightening way and respect him for it.

No back to the topic at hand. If you don't use the word Cloud, Gary, what terminology do you prefer and what's the best way to put across the business benefits in a way that accountants and their clients will understand?
__________________________
John Stokdyk, Technology editor

economic6's picture

Natural Selection

economic6 | | Permalink

I agree with Gary's point that the debate should be about how providers can de-tech their information sufficiently to allow the accountancy profession to make decisions based purely on the merits of individual products and which of these is best suited to their particular practice needs. 

All of this can be well demonstrated without the purchaser wanting or needing an in-depth knowledge of how the thing works. After all, let's face it, how many of us, faced with what actually goes on beneath our car bonnets would be able to sort our brake pads from our batteries (or is that just me?) - but that doesn't stop us choosing which car we like and which suits us best, nor assessing its performance. Why should choosing and using online accounting systems be any different?

I should probably state my interest in this is because I've taken on Communications Director role for E-conomic and see my job's as making it OK for decision makers in the profession to say, don't know a darn thing about technology but I know what I like! 

-- Marilyn

garyturner's picture

Give the man a break!

garyturner | | Permalink

John,

This will sound facetious but we think that the content we've prepared on http://www.xero.com is the best way for interested businesses and accountants to obtain an understanding about Xero. A clipped facsimile in this comment thread would not do it justice and would likely be riddled with most heinous crimes against grammar.

Further, I'll double down on my facetiousness and also say that in lieu of offering a synopsis view I'm also disinclined to deconstruct our philosophy for all to see. I'm cool with natural selection - our competitors can copy someone else's homework.

our competitors can copy someone else's homework

Anonymous | | Permalink

'... is an online accounting system .. anytime .. anywhere ...'

Seem to recall a Martini advertisement along 'anytime...anywhere' lines many years ago

Not offended by the grammar.

chatman | | Permalink

I raised the use of inverted commas because they appeared to be used to imply that we were attempting to debate the issue, but had failed. If their use merely to emphasise something or other, then I apologise.

However, please do not use the great inverted-comma scandal as an excuse to allow the allegation of illegitimacy to go unchallenged. I simply posted some disadvantages of on-line software. What is illegitimate about that, and why describe it disparagingly as a 'so called "debate"'?

garyturner's picture

Not offended by the grammar.

garyturner | | Permalink

I think in future I shall limit my use of Twitter to the conventional 'I just had a cheeseburger' - for attempting to condense anything more meaningful into fewer than 140 characters is wrought with danger.

Using 'this' to describe "this so-called 'debate'" was misdirected (friendly fire, so to speak), I was in fact referring to the over-arching total global war that's currently taking place between most on-premise proponents and most cloud computing proponents that is often called a debate. I did not mean this very debate on AccountingWeb, despite the odd report of inter-vendor gunfire it has itself engendered.

The emphasis on "'debate'" was to suggest that a debate it is not. It's more like a holy war for which there is precedent; Mac vs. PC, Linux vs. Windows, Open Source vs. Closed Source. As an industry we have past form. It's not helpful but makes for good copy and arguments down the pub.

And with that, I'm all explained out.

mramsay's picture

Cloud - foggy advantages?

mramsay | | Permalink

I am not convinced that these claimed advantages stand up to closer scrutiny:

1. It is actually less flexible. For example, how many web hosted applications can claim that hundreds or thousands of different 3rd party applications are conveniently integrated with them (i.e. seamlessly)?

2. 24/7 access is by no means guaranteed - recent outages of well-known web hosted applications demonstrate this and the resulting customer frustration and concern at the business disruption produced.
3. Things are generally cheaper for very good reasons, e.g. poorer quality, less flexibility, fewer features. For businesses the issue is cost-benefit and return on investment rather than cheapness per se.
4. The reduction in internal infrastructure costs and requirements is replaced by higher external costs.
5. It facilitates collaboration - and so do many other solutions
6. It's greener - certainly there is some benefit by having a lower carbon footprint, e.g. using less power and materials, than in-house servers.

Other valid concerns raised by customers include:

a. Security - how secure is my data in the event of hardware failure, fire, flood, hacking, viruses etc?

b. Confidentiality of data - how is this guaranteed, given that governments tend to award themselves, by law, increasing access rights to data hosted in the public cloud?

c. Data in the (public) cloud is 'out of our direct control' (recent high profile cases of memory sticks and CDs being left on public transport come to mind) and

d. Clunkiness, lack of 'rich' interface and general performance issues, which should eventually be overcome.

Whilst I am sure that public cloud hosted applications have a role to play, I think the customer decision-making process is a lot more complex than is sometimes made out. Also, as broadband speeds improve, there may be more cost-benefit in 'private' clouds, where users' business desktops are delivered directly to their chosen device, be it laptop, home PC, mobile, netbook etc more or less 24/7 wherever they may be.

Mark Ramsay, Managing Director, Infoplex Ltd

cverrier's picture

Foggy advantages - a response

cverrier | | Permalink

As a user of a Cloud product (FreeAgent Central - www.freeagentcentral.com), I might be able to answer some of these...

1. Flexibility

If you are the sort of business that NEEDS 3rd-party add ons, then you may be right - linking in cash-tills or bar-code readers or specialised Order Processing software are all out of the bounds of what Cloud/or Saas products can easily handle (for now).  But that still leaves the majority of users who never take these things - a market more than big enough for everyone.

By the way, 3rd-party addons ARE available for some SaaS products, so it's not an either/or choice.  FreeAgent, for example, links with Javelin CRM (www.javelincrm.com), and has an API which it makes available to anybody wanting to create add-ons (There is a time-tracking widget for Macs already available).

In my case, I knew what I wanted, and I found the product that offered the right feature-set first - the fact that it was cloud-based was not really a factor - it just happened that way, and I came to appreciate the benfits of SaaS once I was up and running.

2. 24/7 Access

Point accepted - SaaS suppliers do need to develop SLA's that meet business needs, rather than assuming that a level of availability that works for Facebook will be good enough.

Having said that, after 18 months of using FreeAgent, it's ALWAYS been there when I've needed it.

3. In the case of SaaS - cheaper can also be a reflection of lower running costs (no distribution or manufacturing, no need to carry out endless regression tests on different operating systems, no need to support different releases of the product, etc).   I find that SaaS means that updates and fixes happen FAR faster than is possible for on-premise products, so software quality is arguably higher.

4. What higher external costs?  I already have my Internet connection. The reduction is CAPEX, replaced by much smaller OPEX over a longer period. For me as a small business - cashflow is king, and SaaS serves that very well.

5. Other (in-premise) solutions can certainly be used to foster collaboration, but they all require up-front investment in infrastructure - SaaS has that in place already - my accountant need do nothing except launch a web-browser to access my books at any time - zero cost to him.

6. Not quite sure there's much green benefits either way - savings on cardboard packaging for CDs?  Possible efficiency by having everything in a data-centre, whch WILL be more efficient than any small business can manage.  Either way it'll be marginal.

Other concerns...

a. A 'proper' Data-centre will have better quality hardware, better quality fire-suppression, flood protection, and security than I can ever hope to have.  They will be virtualised, so hardware failure causes an instant switch to a new server with no loss of access - that's pricy stuff for a small business, but run-of the mill for a data-centre.

b. Make sure that your suppliers' data-centre is in the UK, and so is covered by the Data Protection Act.  I don't know of any example of the UK Government awarding itself greater access to UK-hosted data. (that doesn't also apply to data held in non-SaaS systems).   Also - I'm don't care if HMRC want access to my data - if that saves me the job of doing VAT Returns, P35s, etc - then go for it!  Maybe they could just grab my data at year end and save me doing a set of accounts too! (Clearly this won't apply to everybody, but my point is that its not a black & white argument against SaaS).

c. That's an assertion, not a fact.  I'd argue that using SaaS makes it LESS likely that I'll want to carry my data about on memory sticks and CD's (I don't need to - I can access it wherever I need to).  If my laptop is nicked, it now doesn't any of my financial data on it, that's safe in a VERY secure data-center.

d. Go and have a look at FreeAgent or Xero and tell me that either of them could possibly be described as 'clunky'.  Don't go with developers who have tried to convert a desktop product for the web - go with people who have built for the web from the ground up.

cverrier's picture

Back to the subject of terminology

cverrier | | Permalink

If feels like SaaS (or The Cloud, or whatever) is suffering from the same syndrome as any new technology.

In the early days - it's all about whatever makes it new and exciting (in this case - It's on the Internet!).  The early adopters are the sort of people who get excited about the new thing - even if the product isn't that great.  They struggle with immature products because they love how new it is.  Eveyone else waits for version 2.

New providers come into the market, and they want to stress this new and exciting thing because that's what get attention from the early adopters and gets them some actual revenue.

After a while, things settle down a bit, and the main bulk of the market points out that, if a product doesn't actually do what they want, then the new shiny technology really doesn't make them any more likely to actually buy the thing.

A few years back - all the software houses went a bit mad about Microsoft .NET - they plastered the phrase everywhere - even though most customers didn't know (or care) what it was.  ".NET" became a marketing term that meant "New and shiny in some way - buy it!".

That's settled down now - the .NET technology is still there (and it's good stuff) but it's fallen off the marketing materials.

My advice - find a product that actually meets your business need. If it's Cloud based, then so be it, but it shouldn't drive the decision process.  In some cases, of course, the cloudy nature of the product may be a part of your business need (remote access, etc, etc) and that's fine, but then you can be sure that your choice is being made for the right reasons.

In time, the delivery mechanism, or physical location of your new accounting system will become no more relevant than whether your software is written in Visual Basic or Visual C++.   Then, much of the jargon will disappear into the small print in the back of the brochure where it belongs.

 

Provider is important ...

Anonymous | | Permalink

Mark

Many years ago we purchased TAS and at the same time a 'Link' program to interface with some other product (can't remember which)

Subsequently found that TAS was unsuited to the requirements (didn't operate as claimed in the brochure) and sent it back for a refund: no problem.

Unfortunately the same could not be said for the 'link' program - tried sending it back for a refund because we didn't have TAS & therefore obviously it was of no use (even included the TAS credit note as proof). The company in question wouldn't have any of it, and point blank refused a refund - they were eventually persuaded in favour of a refund after threatening a County Court summons.

So everything is not quite a bed of roses in the desktop market and a lot depends on the providers being used

Different stand points...

JC | | Permalink

Mark - it is understandable that you are fighting your corner with desktop programs; however

  • BarCode readers (keyboard wedge style) do actually work with on-line apps because they only emulate the key strokes
  • With on-line apps it is a relatively simple procedure (with suitable validation) to allow external access via WebServices & this will become a 'given' over time
  • Cheaper is a reflection of 'drip-feed' rather than an up front package price. Although, the package suppliers seem to want to 'eat their cake & have it' because they invariably release new versions of their apps on a cyclic basis; expecting more revenue & then discontinuing old versions.

(This results in the accountant needing many versions of the same app (i.e. Sage L50 v.8-13?) just to service their clients; nightmare)

  • higher external costs - eh!
  • USB etc are a red herring. Why bother with these when one can access the data securely from anywhere?

Whist it probably didn't fit the argument being made, you failed to mention low entry level costs and upgrades included in the monthly cost

Nevertheless, all this is really irrelevant because it is down to personal choice & if you are are not comfortable with on-line products then don't use them.

In reality the Cloud/SaaS market is being driven by users and not the accountancy profession and in this respect, like it or not, you are probably going to be forced down this route

"...like it or not, you are probably going to be forced down [th

chatman | | Permalink

JC, your post finished with

"...like it or not, you are probably going to be forced down [the Cloud/SaaS] route"

but you didn't really explain why. What reason do you have for this belief?

petersaxton's picture

There was an explanation

petersaxton | | Permalink

"In reality the Cloud/SaaS market is being driven by users and not the accountancy profession"

So unless you refuse to do what the users want you will have to go that way.

 

That does not really explain the comment

chatman | | Permalink

Peter, all that says is that users are the driver for the uptake of the software. It therefore follows that, if users do not demand cloud over desktop, then Mark is not "going to be forced down this route".

However, the poster obviously believes that users are going to demand cloud over desktop. My question, therefore, is "why does he believe that?".

daveforbes's picture

Give me my data !

daveforbes | | Permalink

What happens if my software supplier decides to pull the plug. As MOA users recently discovered even big vendors can do this. With desktop software it will generally keep going for a while at least. If it is cloud based, where is my data ? I would like to see a "give me all my data in xml button" in all cloud software. It would be great if the could all converge on a standard format for this xml but it is not critical. I would like to see this in all software, not just cloud, but for cloud software it would be of much more importance to me.

mramsay's picture

Foggy advantages - less cloudy now?

mramsay | | Permalink

What excellent feedback. I agree with much of the comment above, which clearly demonstrates that many believe that there are real cost-benefits to the cloud in their particular circumstances. At the same time, each business has to carefully weigh up the costs and benefits - in other words clear the fog. To clear up a few misunderstandings due to my own lack of clarity (numbering from above):

1. Flexibility

Indeed, if you do not need any integration to 3rd party products, the web hosted application route may well suit, other things being equal. However, the enduring and widespread popularity of Excel as a tool for accountants and non-accountants alike, and the resulting need to integrate with it without repeatedly having to perform export/import acrobatics, is a classic example of a much needed 3rd party product. Some day, of course, a good Excel equivalent will probably be developed for use in a browser, with the same potential for integration.

4. Internal vs External Costs

The additional external costs, to which I referred, are the charges levied by the web application service provider. Clearly these are extra costs for a business which is considering the cloud. Nevertheless, those costs might be offset by cost reductions achieved elsewhere, e.g. by dispensing with much of one's IT reseller's charges, electricity consumption, maintenance/support subscriptions etc.

5. Collaboration

Public and private clouds lend themselves equally to such collaboration.

a. Security

The 'pricy stuff' is getting less pricey all the time - and easier to set up and use.  10 or 15 years ago, most small businesses could not begin to afford networks and multi-user applications. Moore's law has changed all that, and continues to do so.

b. Confidentiality

Unfortunately, governments come and go, and policies change. A recent example in the UK is the requirement for mobile phone call data to be held longer and made available to government, ostensibly for national security purposes. Laudable one can argue, but even if the objective is good, the means can get misused - local councils, CCTV cameras and big brother come to mind.

c. Control of one's own data

It may be an assertion, but it is a point made by many customers. Sadly, it is not beyond the bounds of possibility for a trusted person in the 'secure' data centre (or HMRC for that matter) to be induced to help themselves to your customer list. Worse still, the resulting memory stick, or even one from a well-intentioned backup, has had a nasty habit of turning up in embarrassingly public places - and that is not an assertion. Of course, data held in-house is vulnerable to these risks too. But 10 or 20 payroll/HR records from an in-house system is in a completely different league to 10,000 or 200,000 records held centrally. I suppose, also, that it is the very centralisation of data which causes some people to feel a sense of discomfort about the cloud.

d. Interface/Performance

By clunky, I mean, for example, not being able to work with a decent grid for invoice creation. Having to click 'add item', bring up a new form, enter the details, click 'save' (or 'Save and next'), without fast drill-down and around, is not 21st century stuff - it is a bit like reverting to a poorly designed DOS program. Having said that, I accept that, for very low volumes and really simple business models, it would be acceptable and the technology will improve. I would certainly put FreeAgent and one or two others into that category, having tried the demos.

A. on "Provider is important..."

Yes, I agree absolutely. We offer a 30-day money-back guarantee and, I am glad to say, it is very rarely called. But if it is, we provide a refund under the terms of the guarantee. On the other side of the coin, I think we have only once had to threaten action for licence abuse, and many years ago we did once get ripped off by a customer who used the product to its full for 29 days, processing masses of data and getting many hours of support (free), then claimed a refund! He got it, too, but we made a few changes after that...

B. on "Different Standpoints..."

Actually, we develop online systems too. So, we do have a foot in both camps (or part of a foot)! More to come. On the specific, and very valid, point about the accountant needing many versions of the same app: that has been resolved - at least by TAS and I would not be surprised if others follow.

To conclude this rather extended submission, the technologies are all improving very fast and I very much agree with Charles Verrier's advice in "Back to the subject of terminology" above.

Mark Ramsay, MD, Infoplex

 

 

 

petersaxton's picture

More interest

petersaxton | | Permalink

 More people are interested in online accounts due to the advantages and despite the disadvantages. If accountants don't offer the option of online accounts they will be limiting their market.

"More people are interested in online accounts"

chatman | | Permalink

More than what?

petersaxton's picture

The obvious

petersaxton | | Permalink

 Than earlier

daveforbes's picture

Terminology

daveforbes | | Permalink

I think the terminology does annoy people. We are discussing the pros and cons of

1. web based software versus PC based software.

2. paying monthly forever versus other payment models.

When people start talking about "federated cloud infrastructure" a lot of people just switch off. The "Vorsprung durch technik" style of marketing has seen its day.

Could John do a global search and replace the word "Cloud" with "Web-based"

daveforbes's picture

More terminology

daveforbes | | Permalink

I thought if we were going down the jargon route, to using the term "Cloud" for web based, I though we could do with a jargon word for traditional "not cloud" software. I typed "antonym cloud" into google and got http://encarta.msn.com/thesaurus_561568924/cloud.html

cverrier's picture

hah!

cverrier | | Permalink

Very good - thank you Encarta!

My choice would be 'on-premise'  (a bit inelegant, but seems to be the phrase I see used most to describe traditional locally installed applications).

 

Various ...

JC | | Permalink

chatman
=======
If a client comes to you for advice then of course you can point them in the direction of your preferred software (whatever it may be). But in order to do this one needs a balanced view of the benefits of each option

However, if the client has already made a decision to adopt on-line, then as an accountant you will have to use the same system as your client or potentially turn them away.

There is empirical evidence (it's happening) that on-line is gathering momentum and being driven by clients, rather than the profession which has always been rather reserved about its adoption. Accordingly many businesses have recognised the convenience it offers and just started using on-line.

David
=====
Nice idea about XML but probably unrealistic - because

  • XML makes things easily identifiable but introduces considerable bloat to the data - resulting in enormous downloads
  • Most accountancy data is held in relational db's (not flat files) and XML doesn't really address the inherent table structures, relationships etc.
  • Assuming you get all data via XML - it would still be failry unusable; how do you unscramble the data into related tables etc?

Rather than XML a lighter footprint could be achieved by using CSV with field names as column headers

But you are right about the need for backups and ideally where rdms is concerned it would be great if data and structure (sp's, keys etc) could be wrapped in a single backup download - that is the goal

Mark
====

4. Still slightly in the dark about additional external costs. I guess this refers to the monthly subscription levied to use the application. Take Sage L50 for example - you have the package price and annual sub (support etc) and a possible upgrade price every 18 months; also if more than one person wants to use it there are cost implications. For on-line the only cost you have is a monthly sub

Finally it is probably worth asking the following question of existing desktop suppliers

'.. given a clean sheet what would be the preferred way forward for your company - desktop or SaaS/Cloud ..'

One suspects it would be the latter but unfortunately most of these companies have a huge amount already tied up (invested) in desktop apps this inevitably 'clouds!' their judgement on the way forward because they are directly influenced by revenue stream etc.
 

Agree with David - Web-Based is good. Why we have to have 3/4 changes of name in as many years is ridiculous (ASP, SaaS, Cloud... etc)

daveforbes's picture

csv vs. xml

daveforbes | | Permalink

If you pkzip them they end up the same size.

I can convert any csv to xml using my handy csv2xml utility ..... but not vice versa.

JC

chatman | | Permalink

As such a new technology, cloud would be gathering momentum. Whether users are eventually going to prefer it to desktop is another issue entirely, and the two should not be confused.

In your response to Mark, you say that given a clean sheet "one suspects" that desktop suppliers would prefer cloud computing to desktop. I assume the "one" who "suspects" this is you, but why do you "suspect" that desktop suppliers agree with you on this issue?

jimwmackenzie's picture

Positive disadvantages?

jimwmackenzie | | Permalink

 Without speaking for Mark, I'd imagine the answer is that developing and updating web applications is generally less overhead than developing for the desktop.  Testing can be limited to a dozen or so browsers, rather than testing for a myriad combination of operating system versions, hardware configurations and other software running on the computer.  When pushing updates out, web applications again have the edge for developers, as they can just update the code on the servers, rather than relying on customers to run the update.

As with anything, there are advantages and disadvantages with any solution; perhaps one way cloud vendors can differentiate themselves is by not only pointing out where their software has an advantage, but where it won't suit?  Would helping customers to identify if they fit the niche the developer has targeted help more than it would hinder?

 

DuaneJAckson's picture

Some anecdotal evidence

DuaneJAckson | | Permalink

I've spoken to two vendors of desktop-based accounting software recently.

One said when they were in the planning stages of the busines (>5 years ago) they thought long and hard about whether to write the app for the web or the desktop. They went for desktop. He says with hindsight he wishes he now went with the web.

The other is actively working on a web-based solution to replace their desktop system with  a view to migrating desktop users to the cloud and discontinuing the desktop product. 

Questionable assumptions ...

JC | | Permalink

chatman - depends upon ones definition of new; does something nearly 10 years old fall into the new category? Anyway a few reasons for Web-based development preference

  • more fun working with current rather than historic tools
  • greater chance of 'future' proofing systems
  • ability to integrate/interact with other systems worldwide in realtime etc.
  • ease of deployment; fairly simple update processes; using latest versions of application
  • error logging - problems automatically logged & instantly notified
  • fewer potential problems when a new version of an OS is released

Basically, bearing in mind the investment, why would a software house choose to develop something that has a questionnable lifespan when they could attempt to invest for the future? - it is a business decision

In my opinion it is harder to develop for Web-Based solutions that for desktop (chatman - please don't say 'in your opinion' what proof etc; I don't have proof it is simply a view)

Developing & testing are two different areas and once again I have found testing on upteen browsers spanning PC/Mac to be harder than targeting a limited number of O/S such as XP, Vista, Windows 7.

Just to identify three out of many reasons as follows:

  • the stateless nature of the internet - basically the browser doesn't remember anything; so even if you want to pass around something as simple as a date range you have to 'park & retrieve' or pass it every time you want to use it
  • browsers are not standards compliant with M$ historically being one of the worst offenders. So each browser potentially has its own quirks
  • the security model needs to be far tighter

James made a good point about only selling when suitable and not assuming a one solution fits all approach.
 

daveforbes's picture

web based vs desktop

daveforbes | | Permalink

Most desktop apps that are less than about 5 years old are heavily html based anyway. ixbrl is html. Bring up any of our desktop apps, right click and choose view source and  you see html (apart from tax which is pdf), but we are still firmly pc-based. Just chatting to a big cloud accountant, he says "punters love it, but you are only as good as your last post".  

 

 

 

 

daveforbes's picture

.... continued

daveforbes | | Permalink

Very interesting  chat I have had with an accountancy practice that are quite big "cloudists", but also use traditional software.

I had two surprises. Firstly they do find the buzzwords and terminology useful, rather than a hinderance, in pitching to prospective clients. The skill comes in knowing when to use the jargon and when not.

I had assumed that the "cloud" set up would be clients doing their data entry with the accountancy practice be able to keep an eye on what was going on. Quite the reverse here - the practice are providing outsourced complete accounting function to medium sized businesses. So while they are doing all the posting, their clould clients can be remotely "looking over their shoulder".

 

 

mramsay's picture

"Clean sheet ... desktop or SaaS/Cloud"

mramsay | | Permalink

From a developer point of view, we do not see it in those terms. Which brings us back to the terminology and how its use can be quite confusing. Our experience indicates that 'pure' web hosted application services (software + data) is not where the vast majority of our customers want to be - for a lot of the reasons that I outlined above.

Oddly, no-one here has picked up on my introduction of the distinction between public and private clouds. Many of our customers, both businesses and accountancy/bookkeeping organisations, use private clouds in all sorts of different ways to suit their particular business models (home working, on the road, access for external users, be they accountants or clients, etc). In the last 2 years, only one of our 1,300+ customers has moved from that model to a 'pure' web hosted application - and that was for good reason: we will not have an adequate offering for Job Costing/Timesheets until 2010 and the customer could not afford to wait. However, he would have no problem reverting back to us in due course.

Whilst I am pretty sure that the technology behind 'pure' web hosted applications will improve, I think it is always going to be less functional and feature-rich than desktop. However, the good news is that advances in cloud technology (à la Citrix) allow the delivery of your desktop applications via the web+browser, wherever you are and to whatever device you happen to be using (home PC, laptop, netbook, Macintosh, iPhone, Blackberry etc). So you can still enjoy your familiar QuickBooks, Sage, TAS, Excel, Iris, Outlook, Word etc in the cloud without the hassle and cost of retraining! When done in-house we term it private cloud and it is not prohibitively expensive: in fact you can save a lot of money by not having to replace your desktops so frequently. I suppose there is no reason why such technology could not be adapted to a hosted service model too (public cloud).

In terms of 'clean sheet', we are rather glad that we did not rush into developing pure web applications for the 'SaaS/Cloud' space. The way that we now develop our underlying code, our core investment, means that we can easily compile and deploy it to run on a variety of systems, whether on Windows desktop or as Java running on Apache/Linux (webapp), to suit the different business situations/models used by our customers.

Mark Ramsay, MD, Infoplex

chatman - please don't say 'in your opinion' what proof etc.

chatman | | Permalink

 Sorry - didn't mean to offend!

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