The Changing Face of Offshore Programming

teambpsi writes "BusinesWeek Online has an opt-ed piece on the trend in offshore programming pricing going up, with domestic rates going down. As a contractor, I've seen the downward pressure on contract gigs now to rates lower than what I was charging over five years ago. Dell Computers recently announced that it was bringing its customer service back on-shore, I wonder if this might be the start of some bigger trend -- maybe 'buy american' could be our new battle cry ;)"

Comments

A few jobs coming back

[GeckoFood]

Dell Computers recently announced that it was bringing its customer service back on-shore...

Another poster spoke of the specifics of Dell, so I will not touch that. However, Capital One is beginning to bring back [some of the] work it mailed off to the other side of the planet, as they have been losing accounts hand over fist by customers pissed off about not being able to converse with support personnel due to a language gap. Sure, the labor is cheaper, but is it cheap enough to compensate for lost business? Apparently not, in the case of CapOne.

Re:It will all balance out

[The Snowman]

Why is it ok for large companies to benefit from freetrade but wrong for regular people to?

How much time and money do you spend lobbying Congress? I thought so.

As for your doctor comment, some hospitals are sending xrays/mri scans oversees to be read.

Processing of medical records goes overseas too. There was a recent story on Slashdot about a woman in Pakistan basically holding sensitive medical data hostage over a contract dispute. Also, within the last year or two an M.D. in Australia or Hawaii or somewhere operated on a patient in the U.S. with a robotic arm and a fat data pipe. I think that was more proof of concept, but still, they may as well outsource surgery now too. Hire a nurse at a fraction of an M.D.'s salary to oil the robot and turn it off if it goes on a crazy killing spree, and save some money :-)

Re:It will all balance out

[Ezubaric]

I don't think you realize what "Keynesian economics" is.

Also called "Reaganomics," it's when you run up a deficit during times of an economic slump. It encourages the economy to rebound and more quickly get back on its feet. If you balance it out by underspending when the economy is good, you average out to stronger growth (because if you spend too much when the economy is good, you'll overheat).

What you're thinking of is perhaps David Ricardo, who developed the idea of comparative advantage. Even though one country A might be absolutely better at doing everything than country B, country A can't do everything, so it specializes in what it does best (activity 1) and country B do the things that country A does well but not best (activity 2) and trade for can trade activity 2 for activity 1, making everybody better off.

But what you're talking about above is more like assymetrical information, where you don't exactly know the true cost of the product or what the market is willing to bear, so until it's resolved, prices are unstable.

Real reason support was moved

[Johny_Quest]

The real reason Dell moved corporate support back to the US was because they have run out of the engineering talent pool they have so proudly talked about using. This talent is moving quickly to non-voice BPO work with companies such as IBM, MicroSoft, Oracle, Accenture, etc. They have been using liberal arts grads, undergrads, etc. Computer support is difficult without the background. We've seen this before. Dell's follow-up announcement the day after stating they were committed to India was to quell investor concerns. As stated elsewhere, investors only care about one thing. Lehman Brothers cancellation of their in-house support required knowledge base with Sybase, something WiPro and TCS couldn't meet in the end. Indians are good at this - staying on top of the "hot" technologies. I don't think that the expertise (that comes with years of experience) exists there yet. BTW - Some companies are touting US support for all customers. MPC (formally Micron) made such an announcement recently. They took a jab right at Dell stating their top support is not just reserved to corporate customers.

Outsourced government programs

[annielaurie]

This article from a South Carolina newspaper sums up what infuriates me about the entire situation. Here we have Federal and state programs such as food stamps being outsourced overseas. One wonders how many unemployed Americans actually having to use the food stamps might be qualified to work on the help desks--not to mention the other projects described in the article. The politician who rants about "using tax dollars to erode the tax base" makes a valid point.

Then there was this article not long ago on Slashdot, describing a Pakistani medical transcriptionist who decided to cash in on the Great American Dollar Giveaway by blackmailing a patient from a California medical center. At least a US transcriber could've been tracked down and legal sanctions brought to bear.

I think there are some fundamental issues that transcend coding. How much are we willing to give up in the legendary new "race to the bottom?"