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Microsoft auditions small-business push

On the heels of its purchase of Great Plains Software at the end of last year, the software titan is continuing to beef up its hosted service portfolio.

Mary Jo Foley
Mary Jo Foley has covered the tech industry for 30 years for a variety of publications, including ZDNet, eWeek and Baseline. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008). She also is the cohost of the "Windows Weekly" podcast on the TWiT network.
Mary Jo Foley
3 min read
On the heels of its purchase of Great Plains Software at the end of last year, Microsoft is continuing to beef up its hosted service portfolio.

On Monday, the software titan is expected to announce an alliance with Santa Clara, Calif.-based Rivio, through which it could gain yet another conduit for delivering some of its bCentral services for small businesses.

bCentral is Microsoft's portal for small businesses and one of the showcases for how it intends to deliver software as a service as part of its .Net initiative. Yahoo and America Online also have created similar small-business sites.

In addition to hosting Microsoft software and services on bCentral--as Microsoft is doing with Office and some of the Great Plains products it is in the process of acquiring--the company is striking deals to host its bCentral offerings on other small-business sites as well as on some third-party products on bCentral.

Earlier this week, Redmond, Wash.-based Microsoft announced it was ponying up $25 million to help build CPA2biz, the first online portal for certified public accountants and small businesses sponsored by the American Institute of Certified Public Accountants (AICPA). The Thompson Company joined Microsoft and added another $25 million to the project.

As part of the CPA2biz deal, Microsoft gains the rights to offer its bCentral Finance Manager service on the new accounting portal, which is set to go live in the spring.

Finance Manager, Microsoft's Web-based application for handling financial activities including accounts, receivables and payables, is set to become commercially available next month. Microsoft launched Finance Manager in November, as one of three new bCentral services on tap for its site.

"With bCentral, we are looking at channels in different ways than Microsoft has traditionally," explained Microsoft bCentral Director of Marketing Erin Hiraoka. For example, "CPAs traditionally have been very influential contacts--not just in accounting, but also in influencing clients on how to manage their businesses."

The key to success
The pending Rivio deal, which neither Microsoft nor Rivio executives would discuss, is another example of how Microsoft is looking to expand its bCentral influence.

Rivio, formerly known as Biztro, makes a suite of small-business work flow applications. Rivio's hosted offerings are available on a number of small-business sites from the likes of Bank of America, BellSouth, FleetBoston Financial and Verizon Communications. Microsoft is expected to offer Rivio's products, including task management, online payroll, benefits packages and insurance programs, on the bCentral site.

While small-business portals have met with fairly limited success so far, one market watcher said he thought that of any of the players, Microsoft is best positioned to make it work.

"If anybody can do it, (Microsoft) can for sure. They've got the technology, the audience, brand name and the sales force," said Ramon Ray, who writes the Small Business Technology Report.

"Since Microsoft has an existing suite of small biz apps in their Microsoft Office suite of applications, they have a much better chance of success than Yahoo or AOL in blending this in some very interesting ways and tying it all into bCentral," he said.

Ray added that although both AOL and Yahoo have huge audiences, they are much more focused on individual consumers than on businesses.