Those who remember the concern over Year 2000—that when the clock struck Jan. 1 that year, computers would freeze, airplanes would crash and the world as we knew it would end, remember that a lot of that stuff didn’t happen and many people found that accounting software that worked on Dec. 31, 1999 still worked just fine.
Replacing aging accounting software and upgrading operations is important. But there’s that period, often very long periods, in which companies limp along and do okay without buying new applications..
We may be there.
Given the current economic outlook, companies are likely to decide they can afford accounting software some other day.
The returns are not in, but the release of preliminary results for software vendor Deltek for its third quarter ended Sept. 31, may be the shape of things to come. Deltek said its government contracting business was strong, but revenue from architectural and engineering firms was below expectations. It expects revenue to be $70 million to $71 million, compared to guidance of $74 million to $75.5 million.
Microsoft hasn’t yet reported its September quarter and won’t comment on speculation its ERP business hasn’t been making its numbers. Some are linking the decision of channel sales VP Craig McCollum to resign to a sales issue Over the last two years, Microsoft has often reported double-digit revenue for its Dynamics line. But most believe that’s from Dynamics CRM, not its four financial software packages.
Chris Caren, the Dynamics general manager, says conditions do have customers looking for financing to help with purchases. Since Microsoft has its own financing arm, it probably can provide credit in a tight credit market.
Meanwhile, Sage won’t report results for its year ended Sept. 30 until early December, although in August the company issued one of its typical vague statements that results would meet expectations.
However, given the decision of so many Sage VARs to turn to products such as Deltek and Intuit’s QuickBooks Enterprise Solutions for additional software lines to sell, it’s hard to think that the Sage accounting software business is all that strong.
Frankly, it’s hard to think of any part of the accounting software business as strong. But I’d love to be surprised.
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