The announcement that Oracle is taking its name off the small business suite from NetSuite is a signal of just how far the market has not come in terms of online accounting applications.
Oracle’s chairman Larry Ellison is the primary funder of NetSuite, a San Mateo, Calif.-based vendor that was originally called NetLedger, back when the triumph of online applications seemed assured.
You may remember some of the other products from that era, including eLedger, and Bizfinity, and throw in Biztone, which pushed rented applications in general. ELedger did not survive and although Bizfinity’s Web site is still open, the company has made little noise in a couple of years. Biztone’s domain name is for sale. Then there was Microsoft’s Finance Manager, an online application that never saw the light of day, a product that was supposed to be sold through CPA2Biz. There is also InSynq, which has pushed the e-accounting concept, but whose financial results are a tale of woe, while more recently, two InSynq executives were involved in the purchase of Appgen, with the goal of putting its accounting applications on-line.
There are Web-based versions of QuickBooks and Peachtree--but nobody is talking much about them. And Intacct, which is still offering its online accounting system under the label of various CPA firms, has been very quiet in the last year.
That pretty much leaves NetLedger as the only company vigorously promoting online applications that include accounting functions, at least in the mid-market.
Oracle kept NetLedger on the map by taking over the marketing of its original product, which became—and is no longer called—the Oracle Small Business Suite. The product started out at $5-a-month subscription, a tribute to the business mentality of the dot-com era. Oracle is leaving the suite behind, priced at $177 per month.
Meanwhile, NetLedger survived by moving upstream into the mid-market, renaming itself NetSuite in tribute to the idea that you need to sell more than accounting software to make online applications work. With the small business edition back in its hands, NetSuite also plans to push downward into the QuickBooks market. Of course, nobody is talking about $5-a-month any more.
Even with its relative success, NetSuite is small. It had sales of $19 million in 2003 and for 2004 early on it raised its revenue estimates from $30 million to $40 million, with an initial public offering in mind down the road.
No matter how you slice it, a lot of companies still don’t want to put their numbers on the Web.
Online CRM has a lot more promise, witness the success of Salesforce.com, Exact’s sales of eSynergy overseas, and somewhat now in the United States, and the early appeal of online version of Accpac’s CRM.
Some applications can work on the Web. Some people do want Internet-based accounting and a lot more like their contact information out there. Exact hopes to merge its Macola code base with eSynergy.
But it’s a long way from a boom.
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