MYOB beefs up hosting operations with SmartyHost buyout

Stephen Withers
Thursday, 21 August 2008 11:42

IT Industry - Listed Tech

Business software provider MYOB has acquired web hosting company SmartyHost for a reportedly price of $A7 million. Both companies are based in Melbourne, Australia.

Earlier this year, MYOB acquired Ilisys, another Australian web hosting provider. MYOB appears to be following a strategy of increasing the range and quantity of services it offers, rather than continuing to rely on software licensing revenue.

While other software companies such as Microsoft are following a similar strategy, MYOB - and other developers of financial software - have the advantage that a higher proportion of customers will usually be forced to buy annual updates in order to access up to date tax tables and other current requirements.

"Our overarching strategy is to web enable Australian small businesses. We want to make the first step – establishing a website – more appealing to more business owners," said MYOB CEO Tim Reed.

"We also plan to help business owners leverage the internet to 'rewire' their customer and supplier interactions and other core business processes."

A worthy goal. Many Australian small businesses switched from paper to PC-based accounting ahead of the introduction of the GST in 2000 (due in part to a government grant that made the entry-level versions of MYOB and QuickBooks effectively free), yet most of them probably still rely on paper or PDF invoices and purchase orders when dealing with customers and suppliers.

A concerted effort to create a standard electronic format for such documents could lead to a significant productivity improvement.

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