Only if every time I got a penny when some accountant asked me to host or not to host, I would have been a millionaire and not writing this article at all, but I am writing this and clouds is still the buzz word.
In my experience the accountants which are most puzzled by the word are the ones that will be most benefitted by technology. This is so because these people have no idea about what cloud technology is and are most scared of it thus not benefitted by the technology at all. Cloud computing is the platform from which services reach us and these services are called SaaS( software as a service).
Nobody is saying that a flood of Saas will overwhelm us in the 2011 but its market share will not stop from growing.
Many experts are of a perspective that the next revolution in tax software is in the clouds. The key term is SaaS, this is the service you are offered by the company that is hosting your software. For most vendors their product is already more of a service than a product and this mind shift is a new wave with a lot of inertia.
The reason there is so much acceptance of SaaS model is because the nature of the way we use software. It needs to be up to date, easy to use and accurate. All of it is possible in the cloud far more easily than the on-premise model because the customer feedback loop is much shorter in SaaS.
This is the reason hosting companies have gained so much market in the recent years as they are filing a big hole in the market which was not catered to up till now.
The time after which a software company revisits its software to upgrade it and release it back has been shortened by SaaS which is again a huge advantage for the users only. The time is down to a few months from a year, as they do not have to release and then release the software physically in the market, which we all know is a very time consuming process.
Thus the gap between the vendor and the user has decreased drastically.
Big players were ignoring the market up till now but the things are changing and this is what you will see in 2011 also, the big players are entering the market officially.
It is surprising that many users using Intuits Proline have reported a time saving of as much as 25% and had a 1000 tax customers for 2010 tax season, when it could only prepare 1040 returns and also did not even have all the states.
Jorge Olavarrieta, group product manager for the company's tax products says that Proline is a completely new product not an internet version of either of Intuits products Proseries or Lacerte.
"We are going to have full 1040 content for the coming year," he says. Intuit also hopes to provide partnership, corporate and S Corporation software, ready online for the next tax season but cannot promise it.
Although Drake software has not heavily promoted their e-filing software but it still have gained sufficient client base in the market which is a proof of the need for such services in the market. Drake software has an internet version running for four years now and they claim to be leaders in electronic filing which is not all that a surprise because of the head start they have and little competition they faced when they started.
John Sapp, VP of marketing of Drake software said that two versions of Drake software- regular Drake interface and one with an interviewed-based system have been there for four years, with thousands of customers already e-filing their returns.
John says, It integrates fully with our software. It has the same file structure. And he also emphasized that there is no difference between the on-premise software and the online application software. The thing to note here is that Drake and other vendors are themselves trying not to create many differences between the on-premise and online application software, this is a good enough indicator of the direction in which the software are moving.
Lacerte also has shifted some of its focus on e-filing especially when more and more business jurisdiction is requiring e-filing.Fiduciary returns can also be filed online now with new fiduciary organiser. Product manager Olavarrieta says "It's something our customers have been asking for years."
ProForma access rights are a new venture of Intuit, which is ideal for multi-user environment. These rights will be given to tax professionals for protecting the clients returns from being over written while they are in progress.
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