Weekly Review: NetLedger Reaches Beyond Accounting

Several announcements this week broadened the range of integrated solutions available to small businesses from Web-based service providers. Instead of going to separate providers for their online store, their customer relations and their accounting package, small businesses can now sign up with any of several leading providers who cover all of these needs under one roof.

Hot on the heels of its recent $30 million funding round, smallbiz accounts provider NetLedger extended its application portfolio with the addition of new modules for Web stores and customer relationship management (CRM). The full set of apps are available packaged as an integrated suite, called the NetLedger 1 System. See NetLedger Moves Beyond Accounting, April 20th, 2001.

NetLedger 1 System includes workflow and data integration, overcoming many of the data-entry headaches encountered when using standalone services from different online providers. Instead of having to copy or retype information from one application to another, products set up in the accounts system are immediately available for inclusion in the Web store, while customers who sign up at the Web store immediately become visible as a prospect in the CRM module. Workflow enables users to set up many of these actions to happen automatically.

This level of integration may eventually be available between separate services, using common interfaces currently being developed by the Internet Business Services Initiative (IBSi), an industry group of Web service providers. But as an article in this month's ASP News Review spells out, such hopes currently remain far from fruition. In the meantime, businesses for whom integration is important have no choice but to tie themselves to a specific provider.

Bizfinity, which announced $9 million of third round funding this week, provides some strong competition to NetLedger, with a modular suite that includes a site creator, CRM and financial management. E-commerce capabilities include an auction module that links into any of eBay, Amazon and Yahoo!'s auction sites. Workflow is an important feature of the Bizfinity solution, fortified by a synchronization feature that ensures data integrity across multiple stores of information.

Other integrated solutions are available from providers including ELedger and Rivio. But all these startups face stiff competition from more established names who are ramping up their online offerings, including QuickBooks publisher Intuit, and Microsoft, which introduced new features to its bCentral small business services portal on Tuesday (April 17th).

Delivered as part of a new-look bCentral site, Microsoft launched a new Web-based financial management service of its own, along with a custom Web site creation service. The Web site service bundles its Web-based site-building and administration application together with online consultancy from professional site designers, all for a fixed fee.

Although Microsoft's business applications may not currently be as full-featured as those of its longer-established online rivals, it can trump them with access to a huge installed customer base, as it demonstrated Monday (April16th) with the announcement of a bCentral add-in for its Frontpage Web site development package. The add-in puts bCentral's online commerce services for Web sites in front of the one million-plus users of Frontpage. Microsoft also hopes ISPs and developers will promote the service as an enhancement to their own Frontpage-compatible offerings.

Strategic Blunders
Leading Web destination Yahoo! took a step backwards this week with the appointment of Warner Bros old-timer Terry Semel as its new CEO on Tuesday (April 17th). No doubt its investors and various analysts were adamant that bringing in someone with such a strong media and entertainment background would be the ideal choice for a media company like Yahoo.

But the kind of thinking that sees the Internet as just a new form of media is just as outdated as last year's obsession with winning eyeballs as the route to dot-com success. It should be obvious by now to anyone with any real understanding of how the Internet is evolving that Yahoo isn't an online media company  it's an online services company, in common with every other company that does its business on the Internet. The fact that it hasn't been charging for its services presents it with something of a challenge. But turning it into a pale imitation of a traditional media company is the opposite of what it needs right now if it is going to adapt to a viable, service-based business model.

Microsoft must be hoping that its biggest online rival,AOL-Time Warner, will be making the same mistake. Microsoft used to struggle with its MSN portal in the days when media was the only thing the Internet was good for. Now that it's starting to be capable of hosting serious business services, Microsoft is in its element.

Though if it makes a hash of it, it will hardly be the first time in the annals of online computing that an industry big gun has ended up shooting itself in the foot. This week, Siebel informed customers that it will be closing down Sales.com, the Web-based salesforce automation service that it launched with much fanfare in May 1999. The service will cease operating as of June 30, but the company had already begun firing staff who worked on content for the site last Tuesday, according to an Associated Press report.

At the height of the dot-com boom, Siebel had planned to spin off the venture as a separate company. But those plans were shelved once it became evident the days of easy dot-com windfalls had passed. See Mixed Fortunes For Customer Relationship ASPs, Nov. 16th, 2000.

Despite being the undisputed leader of the established CRM market, Siebel has failed to make a success of the online model, despite having vastly more resources and expertise at its disposal than smaller startups. Its inability to exploit the Internet as a delivery platform is in stark contrast to the success of Web-native rivals such as Salesforce.com and Upshot. There's probably a moral to that story, which other industry bigshots should pay heed to.

This review of the week's news highlights is by ASPnews.com founder and consulting analyst Phil Wainewright. A comprehensive news digest is published every month in the ASP News Review newsletter, available exclusively to subscribers.

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