Chuck's Reporting and Technology Corner - November 2009

What is the IPP  - Part II

This is the second and final series on the IPP (Intuit Partner Platform) offering from Intuit. Last month we reviewed the SDK offering  - its weaknesses, strengths, and successes - and then delved into a quick primer on Cloud Computing. This month we will explain the IPP offering, how developers can take advantage of it , and what it means to the Sleeter Group and Intuit consulting communities.

Cloud computing - easier to implement, but with some caveats

As we explained last month, Cloud Computing is here to stay, and the SDK offering is not the appropriate mechanism to integrate QuickBooks data with other Cloud - or SaaS (Software as a Service)  - Applications.   So Intuit devised a more fluid mechanism that would allow developers to inculcate QuickBooks data into their cloud applications.

At first glance we know that SaaS applications are much easier to write than desktop applications.

• Developing a desktop application requires a developer to accommodate different operating systems, multiple patches, and interoperability with other applications on a user's PC.
• Desktop application patches and  version updates require lengthy cycles that can lead to massive rollouts, help desk costs, and end user headaches

However, there are a few new wrinkles:

• Instead of multiple desktops and installations, the developer will use a hosting platform - including powerful hardware, server operating systems, database applications, programming tools, network equipment and metering tools, and a place where the equipment will be housed.
• Whereas  the desktop/server application leaves the basic security in the hands of the end user, the security for the cloud application is now the responsibility of the developer hosting the data.

How developers host their Cloud Applications

Developers can use one of the following options to make their application available to you:

1. Host their own server farms, while handling all of the network routing and security issues.  This is rare, and can be very costly for a small developer; think of the Investment needed for all of the hardware, internet pipelines, network gear, etc etc   Let's face it developers are in the business of developing - not becoming system administrators.
2. Rent the server and network equipment, data center space.  This eliminates the need for investing in costly hardware and appropriate warehousing, but the developer still needs to setup and administer the server software, database structure, user metering mechanisms, security measures, and programming tools.  Again the developer wants to develop - not administer. 

In addition the developer would have to build a self contained billing component - which are costly, and difficult to implement because of security regulations and credit card privacy concerns. 

Renting the hardware, space, etc. is commonly known as Iaas or Infrastructure as a Service

3. Find a company that provides ALL of the components e.g. hardware, software, data space, database administration, billing infrastructure, a variety of programming tools, etc.  For the developer this is really the optimal method - because the developer gets to DEVELOP, and can focus on shorter cycles of application development.

Whereas desktop application cycles can run for months or even years, a Cloud Application can be six to eight weeks. This method is called PaaS (Platform as a Service)

So what does the IPP do for the developer?

The IPP offering is a PaaS offering, and designed with basically one thing in mind:  Let the developer DEVELOP.

The diagram above is a re-creation of an Intuit illustration, but with our own numbering system; it delineates the pieces of their offering.  Let's describe some of these components in detail.

1. The Intuit WorkPlace
   Intuit hosts the application, provides access to the QuickBooks data for integration and synchronization purposes, and provides a billing mechanism. This is the core of the offering.
2. QuickBase
   For those of you who know what QuickBase is, you are probably wondering "what is QuickBase doing here".  For those of you who don't know QuickBase is, it is an online database offering from Intuit, and is used by Fortune 100 business and small business alike. The IPP offering makes available the database functionality of QuickBase - in raw form - to those developers who need a database mechanism within their application; and charges separately for its use.
3. Flex Builder
   This is a cross-platform (can be used on windows or linux servers) framework made available by Adobe, that allows developers to rapidly build web applications that - according to Adobe - can be deployed "consistently on all major browsers, desktops, and operating systems."  Think of it as a programming tool with a toolbox of little building blocks which already contain pre-programmed instructions. Companies like The American Cancer Society, and the Discovery Channel are just a couple of well known entities who use Flex for their web development, because of it power, simplicity, and ease of use.
4. Billing System
   All applications that avail themselves of the Intuit WorkPlace are billed directly from Intuit to the customer.  In turn, Intuit uses a formula that includes things like revenue share, database usage fees, taxes, refunds, etc and deposits the developer share into their account at the end of each month. Revenue share can be as high as 20%, and database usage fees rely upon the amount of data stored in QuickBase, and the amount of time that someone spends accessing that data.  If you really want to try and understand ALL of the exact details, you are on your own - I never got the rocket science degree that someone needed to come up with the appropriate formulas.  If your curiosity is that overwhelming, visit https://ipp.developer.intuit.com/Get_Paid/Revenue; you will see what I mean.

What Intuit DOESN'T do, is determine what the developer charges to the end user.  The developer has to assess what the potential usage fees might be (using a slide rule and calculator); accurately forecast their potential subscriber base, and then come up with a fee that will cover all of those charges - including Intuit's cut - and find a profit margin suitable to the business.  (For all of you number crunchers out there, there is potential business in developer land).

So what happens if a developer/company already has a Saas application hosted somewhere else?

Intuit recognized this need early on, and provided a means for existing SaaS applications to connect the IPP Intuit WorkPlace and avail themselves of two fundamental elements:  QuickBooks data for integration, and access to the millions of QuickBooks users who may potentially use their product.

They are called "Federated Applications".

Currently there are over several dozen federated apps availing themselves of the IPP offering.  MyFax, ExpenseWare, and Pixily are several of the more recognized names in this group.

The IPP offering provides capabilities for these federated applications to "publish" their application, thereby making it available to the Intuit end-user community - just like any other IPP based application.

What are the real benefits to a developer wanting to use the IPP platform?

• The Intuit Workplace
  It provides the hardware, server operating system, billing mechanism, AND security, without the expensive up-front investment.
• QuickBooks data
  The method for synchronizing the QuickBooks data in the cloud is a far superior mechanism to the SDK.  As of this writing, not all of the QB data is available in the cloud, but the plans are to make as much of this data as possible in the months to come. (For the record, this author's work on the now defunct Business Analysis project, contributed to data logic made available in the IPP offering).
• Rapid development
  FlexBuilder is NOT your grandmother's Cobol.
• Ready to order marketing campaign that reaches millions of users
  Developers pay Intuit to handle all of the logistics, but they are also paying for the ability to reach millions of small businesses - at a price much cheaper, than if they did it on their own.  You can open QuickBooks or Enterprise Solutions 2010 and have immediate access to both federated and non-federated applications.  Try, then buy.

What does the IPP mean to the Sleeter Group and our professional community?

• Third party applications will be able to create fixes, and add new functionality much quicker.  How many times have we vouched for a third party application only to run into a trust issue with our client because something was broken, and couldn't be fixed for a long time?
• I want to strongly re-iterate that the IPP platform will NOT make data available for custom reporting or data analysis purposes.  For many this will be disappointing, but the reality is that the data MUST be reformulated and schematized for efficient processing by end users.  At present this is not in the road map.
• Although there is a better method for synchronizing the data using IPP as opposed to the SDK, we as consultants, will still need to work QuickBooks clients on their data setup, and workflow processes.  To the eye, not much will change, other than I expect the integration errors to be drastically reduced.
• Remember that the QB data is being transferred from the desktop to the cloud (IPP Intuit WorkPlace) for synchronization and processing; it does NOT occur on the desktop.
• Regardless of what QuickBooks data is needed by an application, ALL of the QB data will be uploaded to the Intuit WorkPlace.  I repeat, ALL of the data will be uploaded.
• Intuit has an excellent record on security, but, IMHO, I am not personally convinced that the generations older than the current ones, are wholly ready and waiting to put all of their financial data in the cloud - UNLESS they have a compelling reason to do so (or, maybe not).  You will be dealing with the customer psyche here.
• Any consulting revenue derived from software installations, desktop troubleshooting, and application configuration will need to be replaced by other revenue streams.  I certainly see more opportunities for business process consulting and pro-active advice - rather than fudging with hardware/software problems.

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