No --- don't worry. I haven't taken podcasting so far as to start playing 1980's pop rock hits from Queen. The post title is rather designed to chronicle yet another of the old stalwart software companies being absorbed. The twist on this story is that the victim company had actually escaped that fate a few years ago when it was first acquired.
Mark Fenimore, owner of CPASoftware since 1990, sold the company to Best Sage Software back in 2002. Sage's purchase was reportedly "strategic" in that it rounded out the product line to include internal accounting firm products, i.e. write-up, tax compliance, payroll, depreciation, etc. Industry watchers weren't at all surprised when Sage immediately dropped the tax compliance product and transferred the "less than 500 users" to CCH's ProSystemFx as a part of a then fledgling alliance. Yesterday, in a joint press release Sage and CCH announced "that they have entered into a new agreement that significantly expands their strategic alliance and strengthens each company’s ability to best serve the accounting community with premium products and services." Hidden down in paragraph 5 was what I considered to be the meat --- "The agreement also includes the acquisition of the Sage Practice Solutions line of business by CCH, including Sage Practice Manager, Write-up and Document Manager." I interviewed Sage's CEO Ron Verni and CCH's CEO Kevin Robert yesterday. Both were very positive about the business line transfer and almost giddy about a future when CCH content is "built in" to the Sage product line.
[Translations: SAGE: In-firm products are outside our core expertise and providing them to practicing accountants didn't give us the traction we had hoped for. CCH: We really wanted the VPM product as it essentially doubles our practice management user base and, it's already done in .NET and Sequel!]
The transaction gets Sage out of a product line that fell clearly outside their current strategic vision and gives CCH a huge leg up on their long-time vision to be a premier "full-suite player".
GLL's predictions ---- look for a two to three year "convergence" process with CCH's ProSystem Practice and the VPM Sage Practice Manager product. Ultimately VPM will win out as it's at quite a bit ahead technologically. Sage's paperless product (Document Manager) and it's payroll offering will probably die a quiet death while the rest of the line (client write-up, accounts payable, accounts receivable, and client checkbook) will likely find a home in the ProSystem line-up. Score one for Kevin Robert --- this is a strategic stroke of genius. Stay tuned.
gll
