CPA_Practice_Advisor_November_2020 - 11

FROM THE TRENCHES
when a private cloud works correctly,
it is a beautiful thing. You have the
ultimate control for speed, when you
choose to spend on technology, and
application options. Unfortunately, if
you don't have the right combination
of hardware, infrastructure software,
and knowledge of applications, the
solution may never work quite right.
That's where a good IT team or managed service provider comes into play.
Another risk to mitigate was the
physical risk caused by large-scale
storms, including hurricanes and
tornados, and other physical risks
like fire, theft, or ransomware attacks.
We could work around some of these
issues by placing our equipment in a
co-location facility, a specialized data
center that allows us to put our own
equipment in secured spaces. Most
providers to the profession use colocation facilities because it is expensive to build and maintain a large-scale
data center. But even with a co-location
facility, you need to have a replica in
another location in the country which
uses a different power grid. There are
three power grids in the U.S., the east
grid, the west grid, and the Texas grid.
I've had the privilege of building and
touring many data centers throughout
the country. There is much variance
in the quality of co-location facilities,
and the reported number varies. For an
example list of these facilities, consider
https://www.datacentermap.com/usa/.
Managing co-location facilities adds
another layer of complexity.

ENTER THE HOSTING
COMPANIES
Entrepreneurs saw the opportunity
to provide CPA firms as well as other
industries such as healthcare, legal,
or property management specific
hosting customized to their professions. Often, the entrepreneurs did
not understand the complexity of
the infrastructure they would be
responsible for. There was also a lack
of understanding of the criticality
of deadlines. Worst of all was the

complexity and poor design of
the applications built to serve the
profession, which turned out to be
horrible at scale. The deficiencies
were largely covered up with a
local area network or private cloud
installation. The entrepreneur's idea
was to build a monthly recurring
revenue business charging customers (CPA firms in your case) $150-300
per month per user. While I won't
tell the history of all who tried to
compete, a few have risen to the top.
The hosting value proposition was
attractive to partners who simply
wanted IT to work so they could
focus on accounting and outsource
IT. However, most hosting vendors
presented other limitations on
applications they could support,
making things work at acceptable
speeds or for users who didn't have
internet access like auditors.
Further, the software publishers
themselves have offered hosting
services, such as Thomson Reuters
Virtual Office CS or their own SaaS
applications like GoFileRoom or
GoSystem RS. Drake ran their own
hosting operation for some time
and has recently contracted Right
Networks to run their applications.
At the same time, we hope that more
applications can run efficiently in a
browser and as a SaaS offering. This
vision from 1993 has just started
to become a reality in the last five
years. New generation products like
Thomson Reuter's ONVIO will run
in a browser. Wolters Kluwer made
a design decision to use a thick client
instead of a browser for performance
reasons, and today runs all of CCH
Axcess in Microsoft Azure data centers. I can't wait for an all SaaS world,
but who knows when this will arrive!
If we focus on today, internet
speeds are greater, available in more
places, and in general, are more
reliable. Reliable internet has made
hosting with private cloud, hosting,
or using public cloud facilities like
Microsoft Azure or Amazon Web

Services more viable. These providers
have specific hosting efforts for CPA
firms:
■ CETROM
■ Right Networks
■ Ace Cloud Hosting
■ AbacusNext
■ Cloudnine REALTIME
■ Summit Hosting (who purchased
I nSy nq, t he or ig i nal host i ng
company)
■ Swizznet
■ IVDesk
■ Cloudvara
■ Realtime Data Services
■ NetGain
■ NetTek
■ Forum Info-Tech IT
■ Skyline Cloud Services (formerly
Uni-Data)
■ Cloudwalks
■ Noobeh
■ List of Intuit-Authorized Commerc ia l Ho st i ng compa n ie s:
www.intuithostingprogram.com/
authorized_hosts.php
Note that costs and quality vary
widely between these providers.
Firms report to us confidentially
and regularly on their experience
with all these providers. The most
favorable reports are on CETROM,
Right Networks, and Ace Cloud. I have
also received complaints about every
hosting company listed this year
and typically refer the issue to their
management teams for resolution.
On these bad reports, I follow the
Grandma rule: " if you don't have
something nice to say, don't say
anything at all. " While this column
is not intended to serve as a review,
I've listed the better options closer to
the top, and the QuickBooks Desktoponly hosting companies are closer
to the bottom. Note the last link
provides a list of authorized QuickBooks desktop hosting companies.
Our recommendation for CPA firms
is to only consider companies that
are authorized QuickBooks hosting
companies as your CPA firm hosting
company.

NOVEMBER 2020 ■

DOES ANYONE GET IT
RIGHT ALL THE TIME?
The short answer is no. IT is difficult. Hosting is harder. Security is
becoming more difficult. Integrating
Microsoft 365 and Adobe cause
changes beyond your IT team or
hosting company's control. The
days of simple IT for a small firm are
gone. SaaS is not the answer yet but
may be within the next five years.
What should we do today? Choose
a private cloud strategy if you want
greater performance and control.
Carefully select your IT contractor or
managed service provider to supplement your internal or local IT company. Alternatively, you can choose
a hosting company, but you need to
be prepared for problems that may
be hard to resolve or never resolved.
There will also be things outside of
your control, like performance and
outages. You need to have a plan on
how to work when your IT is not working. In other words, what is your plan
to work manually? Don't put things
off to the last minute because your IT
may not work that day. Perhaps being
able to work on a local machine still
has merit. On the other hand, keeping
data on local drives affects retention
policies and presents a whole new
level of risk with security breaches.
Will things get better? Yes. But not
before they get worse, as illustrated
by the Microsoft outages of September
and October. Nevertheless, we were
impressed by how Microsoft scaled
in March and April to support the
COVID-19 pandemic stay at home
orders. CPA firm publishers will get
there. Hosting companies will learn
how to cope with the new hybrid
model of multiple clouds. In the
meantime, if you are running a private
cloud, that may be your safest, leastcost option. If our software providers
run all the applications as SaaS and
Microsoft 365 is integrated, it will just
be a matter of time before our legacy
apps are finally browser-enabled. Can
you say that really fast? ■

www.CPAPracticeAdvisor.com

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CPA_Practice_Advisor_November_2020

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