Not everyone agrees on how to describe the different platforms for accounting software – desktop, hosted and cloud; and in some cases we don’t all agree on the same terminology.

Over the last few weeks, while attending various roadshow-type events, I’ve been interested to hear how the different platforms are commonly described.

Rather than sharing a technical description for each of the platforms, in this blog post I want pass on what I’ve heard so far. I’d also like to hear what else you can add, and/or if you agree.

Desktop accounting software

Any accounting program that’s installed  on your local hard drive is generally called “desktop”. While a few refer to this as “on premises” software, most refer to a program like QuickBooks (soon to be Reckon Accounts) as desktop accounting software. Other points made about desktop are:

  • they’re purchased either in-store or online;
  • they’re often installed using a CD or a link onto a PC;
  • they usually offer rich-functionality;
  • users usually pay once or annually for upgrades;
  • updates occur at regular intervals to provide users with enhancements and/or program changes that help them meet new compliance requirements.

Hosted accounting software

Most agree that software that runs on a remote server and is published so it can be accessed via the internet is known as hosting. It’s not unusual for businesses to host programs themselves but businesses can also outsource the hosting to a supplier, this is commonly known as ‘hosted’. A good example of this is QuickBooks Hosted (soon to be Reckon Accounts Hosted), which offers a familiar experience and the same functionality as the desktop product. Other points on hosted products are:

  • IT costs are lower because hosting is managed for you;
  • users get access to familiar programs over the internet;
  • they may also be available on desktop;
  • users usually pay an annual or monthly fee for access;
  • allows access to fully featured accounting software via the internet;
  • the accounting software is commonly hosted and backed-up in a secure data centre;
  • no software is installed and updates are usually automatic;
  • usually accessible on any device.

Cloud accounting software

It seems there is now a greater consensus, particularly among accounting professionals, that only products specifically built for the web are ‘cloud’. The infrastructure these programs run on is virtualised and infinitely scalable. Some do refer to these as “SaaS” (software-as-a-service) programs, but most used the term ‘cloud’. Other points of note regarding cloud are:

  • no software installation is needed;
  • user experience is built with web in mind;
  • most commonly only accessible via a browser;
  • updates occur at any time;
  • users usually pay a monthly fee for access;
  • they often have an open API that allows for added tools from 3rd parties;
  • they’re accessible on any device.

Reckon will soon launch a new cloud accounting program, Reckon One, that’ll complement our existing desktop and hosted offering. This will be unveiled at our roadshow events coming up in May (more details to come).

As a supplier of desktop, hosted and cloud accounting solutions we feel that all three platforms have their place in business. I think the needs of an individual business will dictate which platform they choose. I plan to put together another blog post outlining what these considerations could be.

What do you think of these thoughts on the different platforms? Does this help make understand the differences clearer?