Microsoft prices SMB accounting tools
Microsoft has revealed some additional details regarding its upcoming Small Business Accounting 2006 offering, which is slated to arrive at its mid-size business conference in Redmond on September 7.
In a conference call with investors on Tuesday, the software giant said it plans to market the accounting package for less than $200. That will bring the product in at well under the $299 that Intuit charges for its QuickBooks Pro, the dominant small business accounting product that Microsoft is looking to unseat with the SBA offering.
Using existing Intuit rebates however, QuickBooks Pro can be found for as low as $180. The company is also expected to launch QuickBooks 2006 sometime this fall, for which pricing has not yet been revealed.
Industry watchers said that Microsoft's ability to create a small business accounting tool that integrates closely with its Office desktop software, in particular its Excel spread sheet application, should help it attract companies that have yet to invest in such business applications. However, analysts believe that Microsoft isn't likely to plunder large numbers of customers away from Intuit overnight.
In a research note published Wednesday, Merrill Lynch Analyst Gregory Smith said that Microsoft's SBA product appears "rich from a feature and functionality standpoint," but he pointed out that QuickBooks also has close integration with Office.
"Intuit will be able to largely defend its QuickBooks market share against this new product," Smith wrote.
Executives at Intuit said they don't expect SBA to pose a threat to their profits and pointed out that Microsoft has attempted to enter their market before with no great success.
"The reality is that we are the market leader and they will be forced to build better products than we already have in customers' hands if they are to grab market share," said Dan Levin, vice president of product management at Intuit. "We've seen Microsoft try to compete in the accounting sector before and they couldn't deliver a product that appealed to a lot of people. We're still the first choice of customers in the small and medium-sized business space, that's not a position that's come easily, and it won't be easy to take away either."
