ACCC Concerned About MYOB’s GreatSoft Buyout
The ACCC has signalled it is wary of accounting software giant MYOB’s plan to acquire cloud-based practice management software provider GreatSoft, saying it could substantially lessen competition in the market.
The consumer watchdog has called for submissions from interested parties on the deal, as MYOB and GreatSoft both supply practice management software to medium-to-large accounting companies.
According to Commissioner Stephen Ridgeway, the ACCC is concerned about the impact the buyout – announced in October – would have on the practice management software sector.
“We received feedback that accountants now have a strong preference to move from traditional desktop-based software, like MYOB’s, to online ‘cloud’ software.
“While GreatSoft’s customer base is currently small, the ACCC is investigating its potential to become a strong competitor as it appears to be a viable choice for many medium-to-large firms wishing to migrate to the cloud,” he said.
Ridgeway said that the market is a difficult one for new competitors to enter, as medium-to-large accounting firms require more sophisticated features from their practice software.
“Software suppliers have to invest significant time and resources to develop functionality to meet the needs of larger accounting firms, and require a proven track record in order to convince accounting firms to switch software.
“While GreatSoft itself faced some of these challenges, we consider that as it has operated in Australia for the past two years, it may now be well placed to overcome them,” he said.
Competing providers in Australia include desktop-based Reckon APS, and cloud-based Xero; alternative products have generally seen limited use by medium-to-large firms.
The ACCC will hand down its final decision on April 22.