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History of Web-based Accounting


A quick & dirty glance at the
brief history of web-based accounting


By J. Carlton Collins, CPA


 

In 1998, Netledger was launched by Larry Ellison of Oracle. Larry put up $25 million t start the organization. In 2000, Larry infused another $30 million. Initially, NetLedger was made available at a monthly rental fee ranging from free to about $5.00 per month, depending on the level of product. In early 2001, NetLedger reported about 3,000 customers. The math works out to total revenue of just $180,000. Obviously this is not enough revenue to support an organization that is chewing through tens of millions of dollars each year. As a result, a major dilemma has risen for Larry Ellison. You see, Larry has long argued the case for "centralized net computing" while his arch rival - Bill Gates has long argued for "decentralized desktop computing". Under Larry's approach, the application is installed on a single file server which is then shared out to the masses. Under Bill's approach, each individual installs their own application on their own desktop computer, and only the data is shared out to the masses. NetLedger thus has become an important pawn in this behemoth battle. If Larry lets NetLedger die, then Larry's opponents will use this as evidence that the net computing is a bad idea, Bill Gates wins, and everybody buys Microsoft applications for his or her desktop. Do you remember when Howard Hughes built an expensive shrine to the Spruce Goose airplane that he later referred to as a bucket of bones - he justified the shrine because he could not let the public know that he had failed. Is Larry on similar ground here? You can see the problem, right? To avoid failure, the folks at Oracle have worked busily to improve the product. They have renamed the product Oracle Small Business Manager, they have re-priced the product beginning at $100 per month, and they have added an incredible amount of features, functionality, and modules to the product. In my opinion, it is a great solution, especially considering the bargain price tag.

In 1999, Peachtree countered back with it's own web-based solution called ePeachtree. This product was the older Peachtree Office Accounting product that was pulled off the shelves, re-tooled, and then redeployed as a web-based solution. Its decent.

In 2000, Intuit jumped on the bandwagon as well. Their offering called QuickBooks for the Web represents a very serious effort to build a new product from scratch, re-thinking the way accounting software should look and feel. there is no question that Intuit is taking the hard road here. They have completely avoided the simple solution of deploying QuickBooks on the web, instead, they are redesigning the whole system - especially when it comes to the underlying technology. The result has been missing features and lacking functionality in earlier releases of QuickBooks for the web. However, they seem very committed. I believe that if they continue to pour in the effort in the manner they are pursing, eventually the results will pay off. 

ACCPAC became to first mid-range player to embrace web-based accounting, and boy did they attack it. David Hood practically bet the farm that web based accounting would be a big hit - and mark my words, it still will be. ACCPAC launched the ACCPAC Online web site in 1999 (http://www.accpaconline.com), which allows end users to run ACCPAC from a simple browser for a small monthly rental fee. ACCPAC has poured their heart and soul into this effort and if you are considering a mid-range web-based accounting software solution, ACCPAC Online is the best place to start your evaluation.

SAP jumped on the bandwagon as well in 1999 with mySAP - yep, web-based accounting featuring a limited number of SAP modules. Intacct, eLedger (who eventually pulled the plug), and many others have stepped up to the web-based accounting plate as well. Unfortunately, no one has hit a home run.

In 2000, Peachtree changed the web-based accounting game in a very interesting way. Peachtree added a web-based module to its' flagship Peachtree Complete Accounting product called Peachtree Web Accounting. Instead of being a full blown web-based system, the user still maintains the software and data on their own internal accounting system. This ensures speed, control of the data, and no dependency on the reliability of the Internet. The idea is simple. t regularly scheduled intervals, Peachtree pushes a copy of it's accounting data out to the web. This allows remote users to access that copy of the data on the web (through password protection) in order to produce reports, make inquiries, and enter orders, etc. Any changes to this copy of the data on the web are synchronized to the original Peachtree data files at the next regularly scheduled syncing interval. hat an idea. This is fantastic and the folks at Peachtree have indicated that their pleased with the adoption of Peachtree Web Accounting whose users now number more than 1,000.

Microsoft has since entered the game as well, deploying Microsoft Small Business Manager which is a scaled down version of Great Plains Dynamics in a web-based manner similar to that of Peachtree Web Accounting. With version 1.0, Microsoft is a legitimate threat, however they didn't get it right. They need to add inventory functionality if they expect to take off. Mark my words, Microsoft will get it right, and they will get it right very fast.

The saga continues...more players will enter this arena, some will succeed, some will not...stay tuned...

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History of Web-based Accounting