One of the latest buzzwords among the tech set, an ASP is akin to a software rental service. Rather than purchasing software, users sign up for a monthly subscription service, where the Web-based software applications are hosted by an outside firm that typically offers round-the-clock support.

The allure of the ASP, according to advocates, is lower cost (rather than laying out a lump sum to purchase the software, users pay a monthly fee usually based on the number of users), and the ability to access information anytime, anywhere. Because the software is Web-based, the ASP also eliminates the need for installations and upgrades.

Steve Siegel

"Access to real-time information, and the ability to exchange information and work from anywhere is the value of the ASP," said Steven P. Siegel, vice president of CPA channel development. So far, the ASP model has proven most popular among start-ups and Net-savvy larger companies, he said.

ASPs could also help firms feeling the pinch of a tight labor market cut down on and the need for IT staff, added Ken Mueller, FiNetrics president and chief executive. "It's more cost efficient. There's a shortage of accounting and IT professional," Mueller said. "(With an ASP) the back office is gone. All you need is a PC."

Ken Mueller

From the looks of the already crowded market, providers are optimistic that accounting firms will be quick to jump on the ASP bandwagon. A flurry of other ASP vendors, such as NetLedger, eLedger, and CPAvenue, have also set their sights on targeting accountants and their clients for their online offerings. And it's no wonder: FiNetrics estimates the market for online small and mid-sized businesses financial services is $58 billion and growing at 20 percent annually.

The ability to build a virtual office could potentially give smaller firms a leg up in offering services similar to those offered by larger firms, which themselves have been scrambling to become one-stop shops to compete with accounting firm consolidators.

FiNetrics' offering, OutNumber, is an ASP for products from SAP, a high-end accounting software vendor that's now tackling the middle market. The current offering is tailored for firms with up to 100 people; a more robust solution for mid-size firms is due out in October, according to Siegel. Pricing for the low-end offering is $49.99 per user per month. The higher-end solution will be priced between $300 and $400 per month.

The ASP is the centerpiece of a suite of bundled FiNetrics products called AccountingSource that includes a business process outsourcing solution, called OutPut, and an offering called OutSmart, which includes outsourced consulting services like controller and chief financial officer functions. Pricing for both OutPut and OutSmart is transaction-based. The company has partnered with a Big Five firm to deliver AccountingSource. FiNetrics also unveiled its reseller program for accountants, FiNetrics Accounting Institute program.

-- By Melissa Klein

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