Intuit Gives Up on Financial Services, Embrace Accountants (again?)

Filed in Intuit QuickBooks, Xero by on July 3, 2013

In light of Intuit’s bad tax season (a 5% drop in TurboTax filings), it did not surprise me to see Intuit give up on financial services.

Intuit bought Digital Insight in 2007 for $1.35 billion. I questioned this high price at the time and since then, as since the company only sold software small and medium banks. Intuit could not change that, so estimated gross revenue was only $325 million. Therefore, Intuit sold Digital for $1.03 billion, a loss of $320 million. Intuit also announced it was planning to sell its health group, as it gives up on financial services. It will use the proceeds from these deals to boost its share repurchase program. That means we cannot expect a surge in needed QuickBooks, QuickBooks Online and other needed software improvements.

Despite this, Intuit also announced that it would soon Embrace  Accountants (again?), but will do so by :capitalizing on global opportunities.” I was glad to see plans for an Accountant and Advisor Group, to focus on loyal accountants, who use and recommend Intuit small business solutions. Brad Smith, Intuit CEO, said, “The role that accountants and advisors play in small businesses’ success has never been more important. It will be a critical component as we pursue our goal to be the world’s small business operating system.” A second accountant organization, ProTax, will focus on winning the professional tax category in North America, capitalizing on the shift to cloud and mobile-based solutions… This strengthens our opportunity to work directly with accountants as they prepare client taxes. We have opportunities to accelerate growth as accountants shift online…”

The only problem is that accountants have heard Embrace Accountants (again?) since 1999, as Intuit repeatedly bypassed and even denigrated us. It also repeatedly reversed changes it suggested to its first (2002-2003) QuickBooks ProAdvisor group and ignored many of our best ideas for years, if not forever. More immediately, Brad Smith recently said Intuit would primarily emphasize consumer contact, as a way to get more users.


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