This week, Wolters Kluwer, the parent of CCH, made it clear that it intends to mine the data it has accumulated, although the company has not yet detailed what applications might be introduced into this market. But analytics is clearly in the air as a similar discussion occurred last week with Avalara, the sales-and-use tax company that happens to compete with CCH in that product category. Avalara has hooked up with almost 200 software publishers so that they can utilize its AvaTax product as their sales tax engine and it plans to add 50 more vendor allies this year.
What that means is that Avalara is going to be drawing in a growing amount of data. Similarly, the company's executives and managers did not provide specific plans of how they might go about this task. But it's an obvious step.
It's an obvious step for many vendors. For one thing, they have the data and it can be turned to other uses. Another factor is that since most preparers have tax software and most companies are using accounting applications, there is not much growth potential in selling to new customers in the United States That is also shown by Wolters Kluwer's moves to grow its international business, which has been predominately an American operation until recently.
So companies will turn to analytics because it is a new field for them with revenue growth potential. And also, customers would prefer to get more out of their existing applications and analytical tools are the logical devices for accomplishing that.