Bangalore Beats Silicon Valley

An anonymous reader writes "The inevitable has happened. Bangalore, which grew under the shadow of America 's Silicon Valley over the last two decades, has finally overtaken its parent. Today, Bangalore stands ahead of Bay Area, San Francisco and California, with a lead of 20,000 techies, while employing a total number of 1.5 lakh engineers."

Comments

Swinging back to a balance

[ChaoticChaos]

It's amazing that during an election year that I've yet to hear one thing from Dean or Bush about this. Is everyone bought and paid for?

I honestly think that a lot of the current commentators are dead on when they say that this is a "fad" and this will eventually balance itself out. Wait until some corporations get a gut full of having their code halfway across the globe. Most companies aren't willing to let you work at home and yet they're willing to hire hoards of people they'll never meet to write their code? Heh. This will right itself eventually.

Re:Swinging back to a balance

[squaretorus]

Wait until some corporations get a gut full of having their code halfway across the globe

Yeah - they'll move to India too. You can get a seriously big house there, great food, and your kitchen staff won't be a: Expensive, or b: Illegal.

I'm guessing the tax advantages are pretty significant too. And you get to watch elephant polo!!!

Re:Swinging back to a balance

[Puls4r]

I think you may be operating under the illusion that this is something that Bush is against. I'm sorry, but his party and his political views support free trade. India and other Asian countries are simply doing what Mexico, Taiwan, and China have been doing for years in other markets. Why do you think it's suddenly so earth shattering? It's a natural progression of a commodity to move to markets with lower overhead costs. Like pay rates.

Re:Swinging back to a balance

[Pionar]

Dean has often commented on this. One of his main slogans is, "We should be exporting American products, not American jobs." and has often stated that his plan of including workers' rights policies in trade pacts will stem the tide of the unethical offshoring of labor at pennies on the dollar.

Re:Swinging back to a balance

[glenrm]

You also have to hire some armed guards, at least that is what I saw in a show about the people making money in the Indian film industry.

Re:Swinging back to a balance

[Glock27]

It's amazing that during an election year that I've yet to hear one thing from Dean or Bush about this. Is everyone bought and paid for?

Sadly, this appears to fall into the "globalization" groupthink. It's a "free market economy" therefore it must be good...right?

Since we've lost all kinds of other industries overseas (for instance, steel production) this latest trend is taken as simply the latest incarnation. No one seems to be thinking "gee, we were supposed to lose the manufacturing jobs while the high tech jobs stayed here".

There are many stupid things about outsourcing IT jobs. First of all, 50% of all software projects failed before outsourcing became prevalent. I'm personally sure that percentage will be significantly higher with outsourced work. Second, U.S. companies are paying to train large foreign workforces to compete with them down the road. Third, the lack of high-paying tech jobs here in America will ultimately hurt the economy, as well as causing many skilled tech workers to move to non-tech positions. One wonders if this new "lack of tech workers" will be used to justify new H1-B visa bills as the economy heats up again.

In my opinion, the whole debacle arose from executives being annoyed over the high cost of tech labor - they didn't understand that tech is hard, requires lots of education, and should be compensated accordingly. It's sad that contract software rates have fallen to about 50% of their level of a few years ago. It also looks like permanent position salaries have been impacted.

I'd like to see a few executive teams outsourced to India...then we'd see some real screaming about the practice.

This will right itself eventually.

I'd like to think so, but we'll have to see...

In the meantime, classified government work looks like the best bet as far as job security goes - that will never be outsourced.

Re:Swinging back to a balance

[dnoyeb]

Yes, but what is balance? Note that America has an abundance of the world's wealth, and India's region has an abundance of its poverty.

Balance will be when much of the wealth in America is shifted to India and the like. I know this is the right thing to do. However, the problem is the wealth shift will be removed from the middle class in the US, and as usual the Rich have well protected themselves and will still grow richer...

Re:Swinging back to a balance

[rifter]

I honestly think that a lot of the current commentators are dead on when they say that this is a "fad" and this will eventually balance itself out. Wait until some corporations get a gut full of having their code halfway across the globe. Most companies aren't willing to let you work at home and yet they're willing to hire hoards of people they'll never meet to write their code? Heh. This will right itself eventually.

You'd better hope so, buddy. Personally I am pretty worried; perhaps I should brush up on my Hindi. Bollywood just beat Hollywood in production and also has announced that it will allow people online to market their products for free whereas Jack Valenti has decided he does not want such help. Now Bangalore has surpassed Silicon Valley in number of jobs but NEVER in cost of living. With even US firms shipping jobs to India like mad, all that is left to light this match is a batch of new Indian software products to compete with US products.

Meanwhile our IP laws mean that it is very undesirable to work on new tech in the US because it will either be shelved, owned by a corporation, or some other company with a patent will make sure you can never do it. But these problems do not exist in India. Neither do they put people in jail for developing crypto software and revere engineering for interoperability. Free Software has no stigma in India and is used where practical unlike in the US where we would rather waste money than do it right.

India is a mixed economy and I've never known an Indian to be afraid of being called a Communist, or for that matter to use the term as a pejorative. Again, collective or community economy is used where practical and private industry is used where it makes more sense. None of this business of endangering the electric power infrastructure in the name of corporate profits.

If there is anything holding India back now, it is government corruption, civil strife, and the struggle with Pakistan. But who knows, maybe they will get that all down to a low simmer so it does not disrupt their blossoming economy. Remember, they only won their independance less than 60 years ago. These things take time.

Re:Swinging back to a balance

[Oggust]

The gub-ment could provide tax incentives to keep employees in the states, etc. There are things that could be done.

Tax incentives? You want other people to be forced to subsidize your paycheck?

In what way is that better than the utterly immoral subsidies some other industries (steel, textile etc) get? I'm talking about the specialty steel tariffs and so on.

If you can't compete with the indians, tough luck, get another job. That's how capitalism works. That's how it's supposed to work. That means better prices on the products for everyone.

Lowering the overall tax rate is the only good tax incentive, I've had it up to here with whining special interest whom are all uniquely deserving of other people's money in their own heads.

/August.

Re:Swinging back to a balance

[enjo13]

I think your wrong.

Your falling into the trap of thinking that wealth is finite, or at least constrained at its current levels. This is simply not true. The amount of wealth in the world can (and does) grow. In terms of overall 'wealth' (see a good economics text for a description of what exactly wealth is:) ) there is many many times more wealth today than just 100 years ago. The same will likely hold true moving forward (there is likely some limit to how far this can grow, but no economists can even begin to agree on what that limit is).

The point of this is that as India becomes more wealthy, they will begin to contribute more and more in terms of innovation and products back into the overall economy. This will do two very important things. 1) Create new markets for companies (including those in the US). After all, the workers in India will have more wealth and will begin buying more products. 2)Create demand for more services within India itself (once again, more wealth to spread around) which will drive the costs of employment up towards U.S. levels. In the end, the amount of overall wealth has increased, and the amount of wealth within the United States is at worst basically unaffected and more likely actually increased because of the new markets that have been opened up.

There are ways to defeat this. Closed trade policies are the quickest. By adopting protectionist policies the U.S. can effectively isolate itself from these new markets, likewise India could do the same in an effort to protect it's new found wealth. The governments role SHOULD be to protect equal OPPORTUNITIES for trade between India and the U.S. (thus encouraging growth in both countries), rather than attempting to protect the RESULTS of that trade.

This is one case where everyone can hope to win, rather than having exactly 1 winner and a bunch of losers.

Re:Swinging back to a balance

[frodo from middle ea]

One of the main reason for this is the indian film/music industry is not syndicated by big studios like hollywood.

And therefore the money required to make big budget movies is often put in by underworld mafia. Ofcourse this is all covered up and the money is shown as comming from big time industrialists and stock brokers, but even a kid in india knows the real truth.

And when you involve underworld, they want a hugh piece of the pie, and sometimes entire pie. Whenever there is a financial dispute between the producers and director/actors etc. it is often setteled by mafia. Mafia in turn gets (demands) hugh amount of money from the big shots for what it calls protection money.

There have been incidents where rival direcots/actors/music composers have hired the mafia to threaten/beatup or even kill their counter parts.

The history of mafia's association with bollywood is not older than 30 years. Around the 70s time, when bombay (the core of indian movie industry), was the hottest thing for real estate development. There was a lot of money to be had in urbanization and construction builders often used local mafia (small time crooks) for dirty works , such as forecd labour, evicting tenants , suppressing any kind of opposition. etc.

But the maifa was very disorganised back then, and the construction company owners were the ones who called the shots. But soon the indian maifa much like the turn of the century american mafia , organised and turned crime in to a syndicate. This gave rise to some really notorious gangs in bombay and some fierce gang wars.

By mid 80s the , crime syndicate turned their attention to the movie industry (Although they were always associated with bollywood since the 70s). Initially the relationship between the movie industry and maifa was a win-win situation for both, but soon maifa wanted more and more . It got progressively worse in 90s, where there were a lot of incidents of movie people being threatend/shot at by maifa. By then the mafia had shifted its base from bombay to outside of india. But a large supply of unemployed youths in the country ment a continuing domination of the maifa , even when the strings were pulled from outside the country.

Bombay police which were once considered second best only to scotland yard, earned a lot of bad reputaion in this time for their incapability to stop the crime waves. This led to the encounter era, where the police were on a city cleansing mission. Lots of small time gangsters and gang members were arrested, and then shot by the police in a staged escape. Police claimed the culprits were trying to escape while the human rights organisation screamed murder.

Currently it looks like there has been some equilibrium between the maifa , the film industry and the police. Also lot of film makers are shifting away from bombay to other places.

But will it last?

[TheWart]

It will be interesting to see how long it can sustain its growth to prevent the same kind of retraction that hit Silicon Valley.

Re:But will it last?

[Saeed al-Sahaf]

As long as the wages are low and the quality of code is at least acceptable (and, these people DO do good work), India will continue to get the jobs. Remember: The PRIME responsibility of the board of directors for a publicly traded company is to MAKE MONEY for it's stock holders.

Re:But will it last?

[lucabrasi999]

It will be interesting to see how long it can sustain its growth to prevent the same kind of retraction that hit Silicon Valley.

There are 250 Million people living in the US. There are a limited number of IT people. Hence, higher wages and the extensive use of H1B Visas.

There are over 1 Billion people living in India. And, according to my Indian-born Co-workers, they have more college educated IT workers than any other Country in the world. Hence, the supply of skilled workers is much higher. Although the salaries will increase, I don't think they will explode to our level any time soon.

In other words, if you are waiting for an Indian version of the Dot-Bomb, don't hold your breath.

For those who are too lazy to search...

[mesozoic]

...a lakh is 100,000.

Re:For those who are too lazy to search...

[asdfasdfasdfasdf]

...a lakh is 100,000.

You see, this is why they are beating us. For us to say "One hundred Thousand" it takes five syllables, for them at most two.

Efficiancy, Folks, Efficiancy.

Uh, no, it has nothing to do with the fact that I'm posting on Slashdot instead of working.

Re:For those who are too lazy to search...

[JDevers]

Maybe it also has something to do with you not being able to spell "efficiency"...

1.5 Engineers

[Anonymous Coward]

"Bangalore stands ahead of Bay Area, San Francisco and California, with a lead of 20,000 techies, while employing a total number of 1.5 lakh engineers."

1.5 engineers hey. Always wondered where that 0.5 kid from the average 2.5 family got to. Engineering.

Re:Lakh?

[jazzyseth]

One entry found for lakh.

Main Entry: lakh
Pronunciation: 'lak, 'lak
Function: noun
Etymology: Hindi lAkh
Date: 1599
1 : one hundred thousand
2 : a great number
- lakh adjective

Sand Hill Road

[bstil]

Is this an New Year's/April's Fool article?

I don't see the folks on Sand Hill Road moving to India very soon.

Also, the article is from India Times, so expect some bias.

Re:Lakh?

[Tirel]

magic% dict lakh
3 definitions found

From Webster's Revised Unabridged Dictionary (1913) [web1913]:

Lac \Lac\, Lakh \Lakh\, n. [Hind. lak, l[=a]kh, l[=a]ksh, Skr.
laksha a mark, sign, lakh.]
One hundred thousand; also, a vaguely great number; as, a lac
of rupees. [Written also {lack}.] [East Indies]

From Webster's Revised Unabridged Dictionary (1913) [web1913]:

Lakh \Lakh\, n.
Same as {Lac}, one hundred thousand.

From WordNet (r) 2.0 [wn]:

lakh
n : the cardinal number that is the fifth power of ten [syn: {hundred
thousand}, {100000}]

Interesting...

[pubjames]

A couple of years ago on a train journey to Mumbai I had a long conversation with an Indian software engineer. Once he'd got his University degree he got a job in Silicon Valley, but only stayed a couple of years because he realised that although salaries are lower in India he would actually be a lot better off in India because your dollar goes a lot further there. In India he could actually afford servants - a maid, cook etc. as well as a big house with a swimming pool and car. So if you read this type of story and think of hundreds of poorly paid Indians in sweatshops hacking out code, think again.

Re:Interesting...

[TheSync]

All of my "middle class" relatives in El Salvador have at least one live-in maid, some have several as well as a driver and gardener. Interestingly enough, some of my relatives there work in the computer industry.

Re:Interesting...

[Anonymous Coward]

He may have felt that way but I rather doubt that it's true. I'm building a development team in India and can tell you the following (all below in US $):

1. Wages range from $5 to $10 per hour for developers, senior developers, and architects.
2. Stuff from India is cheap (e.g. maid = $100/month) but foreign stuff is just as expensive as elsewhere. For example, a Compaq computer is still about $1,000. A low-end Toyota is still over $10,000. There is however an India made car that's around $5,000. (Based on Bangalore newpaper ads in December.)
3. A three bedroom tract home in a gated community will still cost about $150,000. The home is nice though with granite floors and counters. (I personally visited such a community outside Bangalore last month.)

The materialistic hope for most IT workers is to simply own their own car. A home and maids are still largely beyond reach.

Re:Interesting...

[ashayh]

A maid and a cook is good for you.
But do you know how much the maid/cook will get paid? In a big city, where wages are higher, you would pay them Rs 500 to 1000 .. thats 10-20$. If the maid works many hours in 3-4 places, she'll get 60-80$ a month if shes lucky. At this rate, when does her son get schooling, decent college, University etc and become an engineer ?
So while the dollar does go further, it doesent do the vast majority of Indians who are farmers, labourers, servants, etc. ANY good.
When will the maids son even think of becoming an engineer and getting his own big house with pool? I think its when wages for everyone go up .. so that when the maid wants 100, and people can afford to give it.
As an Indian, I like the fact that many people in US, even well off ones HAVE to do their own laundry, cooking etc. Because that means that there arent a lot of poor people left to become maids/cooks.
I do not know why you say "a big house with a pool". Although I havent counted, I am willing to bet that the number of s/w engineers in India with a house(not apartment) with a pool is way, way less than you imagine. Hell, the number of total pools in India is less that you imagine.

so what?

[Dionysus]

I'm sorry, but so what?

I'm not an American (Norwegian if you must know), but I have worked in Silicon Valley. Like the saying goes, it's not the size, but the quality. Yes, the best engineers in India is probably comparable to the best in the US and the rest of the world, but I find that the average engineer in India is worse than the average in the US.

I'm afraid I don't care

[AKAImBatman]

And I care because... why? At its height, Silicon Valley/San Fran contained thousands of individuals hoping to get rich quick by pretending to be techies. Now India has thousands of individuals hoping to have a better life by pretending to be techies. There's nothing new here. Move along.

No way.

[YanceyAI]

I'm sure that textile and factory workers felt the same for awhile. I hate to sound like a Marxist, but welcome to market driven, capitalist America. They're cheaper, they work longer, they demand less.

Those jobs aren't ever coming back and neither will these.

Re:No way.

[Joey7F]

You forget one thing though...they aren't cheaper. A 20k salary in India is pretty damn good (Some friends tell me it is like six figures over here), well, eventually the disparity will disappear and they will demand more salary. With US programming jobs disappearing and starting salaries coming down, at some point companies will have to say "Wait, how much are we saving exactly?" It has happened with call centers...

--Joey

Re:No way.

[NeoSkandranon]

Disclaimer: I live in a textile town. Three mills have closed here so far, and the local college is now FLOODED with older people looking for a new vocation.

You are misinformed. The people hurting the most from mill closures are older men and women who have been in textiles all their lives from getting a job in the mill at age 18 to help the family out. In many cases college wasn't even an option, let alone a viable choice because it would require not only cutting a source of income but also putting out massive amounts of money for several years.

If you think working in a mill requires no skills, I'd love to see YOU go do it. There is no college degree required because on-site-training is the name of the game.

Re:No way.

[Greyfox]

No, then the companies will just move to the next low-wage country, lather, rinse and repeat, leaving tens of thousands of indian programmers out of a job.

Most of the IT industry is no longer about doing cool things with computers. It's no longer about understanding the customer's business needs and making the computers do what he needs them to do. It's all about the money and too many people are in it just for the money, bringing no understanding of the industry with them. Oh they make noises like they know what they're doing, but they don't.

Start a company that avoids all this management masturbation, gives its people the power to solve problems without having to go through 14 layers of buerocracy and that actually understands its customers business needs and you'll end up owning the market, whether or not you're operating from the USA, India or from East Outer Mongolia. And incidentally you might make a buck or two at it.

Re:Petition

[palutke]

Now would be a good time to put together a petition and send it to the various candidates and demand that there be some restrictions to all the tech jobs going overseas.

Good luck. Unless you accompany your petition with big sacks full of money, don't expect any results (other than a polite letter -- maybe). Those same candidates/elected officals didn't act when manufacturing jobs went offshore, why would they act now?

Re:Last?

[slamb]

Name 5 great software products to have come out of Bangalore.

Name five great software products that you're sure haven't come out of Bangalore.

The companies aren't based there, but enough of the work is actually done there that you need to put some actual thought into answering that question...

On the other hand, I don't have a high opinion of Bangalore-as-Silicon-Valley, either. I just don't think you'll get anything really remarkable out of people under those conditions. And if there's one thing the world doesn't need, it's more mediocre programming...

Re:Lakh?

[mgs1000]

Your post also could have been done much cheaper by an Indian engineer.

Economist article

[Infonaut]

The Economist, as usual, has the goods. This article lays it out pretty clearly. Things are rapidly changing in India, but for only a small percentage of people.

What I find most curious is the incredibly rapid turnaround in opinion seen on Slashdot. During the dot-com boom, everyone was happy to see Open Source, a truly global phenomenon, bloooming. But now I see this strange bifurcation of views. Open Source software created by people from all over the globe is still good. On the other hand global commerce, in which the lowest-cost providers of goods and services win, is being villified.

So when a Chinese company (operating in non-democratic government) manufactures the inexpensive hardware that powers your gaming PC, that's fine. But when Indian programmers (operating in a democratic society) start beating out American programmers for jobs, there are some sort of insidious forces at work?

When principals butt up against pocketbooks is the time when you see what people truly believe.

Re:Economist article

[Night Goat]

I wouldn't call it a turnaround in opinion, just another facet of the "Slashdot hive-mind" that you didn't notice before. It's not like people on Slashdot were cheering before when their jobs were just starting to go to India. Open-source is totally different than international outsourcing.

Re:Economist article

[Valdrax]

What does Open Source software have to do with our (in the average case) closed-source programming jobs going overseas to people who will write closed-source code for our former companies for less money? Open Source is good. At least if I lose my job to OSS, I know that I have full (and free) access to what replaced me and I know that on the balance the world has been done good by making a quality product available for less and with more eyes capable of scrutinizing it for bugs. If I lose my job to outsourcing, I can see that the customer is unlikely to see a reduction in price (or bugs) for the product, and the market is favoring poorer labor conditions. Overall, the world has not benefitted by my loss, so why should I like it? In this latter case, my principles and my pocketbook are both in agreement that this is a bad thing.

By the way, if you're of the opinion that Slashdot readers are fine with what makes Chinese hardware inexpensive, then you haven't paid attention to the articles on the failure of cheap parts, the hidden costs of poor labor practices, and the environmental impact of computing articles on Slashdot. I'd buy non-Second/Third World goods if I could, but there's honestly many place where you simply can't get an alternative.

(Thanks for the article, though.)

Won't somebody think of our future

[GreenCrackBaby]

I've always wanted to post this in an "offshoring" /. article, but have always arrived late to the game.

Firstly, a disclaimer: good on India. I hold nothing against them for accepting, with open arms, North American tech jobs as fast as CEOs rush to send them over.

That being said, I believe we (ie. North Americans) are being fucking morons about this. We are willingly shipping them high skilled jobs so Mr. CEO can report a quick profit the next quarter. In the mean time, we are losing an entire generation of "junior" positions. I believe that will spell the end of software development in North America.

My current job is that of a software architect. It is a high-skill job requiring very specialised knowledge in the area where we make software. I got to my current job by starting as a junior programmer at this company. After 3 years I was bumped up to "intermediate" developer. After 3 more it was a bump to "senior" developer. Now they think I know enough to design the systems I build.

Two years ago my company opened an office in Bangalore (we have offices across the globe). All new hiring has been through that office, and they ship the programmers from India to various other offices for training on projects. In another years time, programmers in that India office will have performed enough implimentations to be considered "intermediate" developers. In a few more years they'll be senior, and in a few more they'll be in my position.

As this is going on in India, all our own new grads will be working at Starbucks serving lattes, and will be left out of the loop.

All for the sake of a quick stock boost. Good on India, shame on us!

I don't know if

[UnknowingFool]

anybody should be celebrating that they have more nerds than another place. It's like posting up a big sign that says:

"Attractive Women: Stay away. Nerd Crossing"

Republicans have struck deals to postpone layoffs

[Magnus Pym]

If you think times are bad, just wait till the election is over. The Republicans have struck deals with several dozens of corporations to postpone their outsourcing decisions till the 2004 elections are over. Expect to see wave after wave of US layoffs in the wake of the elections... especially if Bush wins again.

There was an article in the WSJ last month about exactly this. Apparantly, huge companies like IBM and Microsoft are keeping a low profile in India. MS has gone so far as to remove their names from the buses that they use in India to ferry programmers back and forth to work.

Magnus.

The real winners in globalization

[Perl-Pusher]

In the rush to globalization, the US has export most of it's manufacturing capabilities. Count how many products in your home are made in the USA.

When we no longer produce anything of value here, what do we have to trade? One thing we can do is educate people, foriegn students continue to come to the US in greater numbers to learn. Another is tourism. How many Indian's want to vacation in Detroit? Our college costs keep rising to the point that it is becoming more and more difficult for the middle and lower middle class to get an education here. The middle and lower middle classes make up almost 70 percent of our population. Another thing we have is money lots of it. Not you or I, but the ones really pushing for globalization. The 1 percent of are population that controls most of the worlds wealth and now wants more. These people find a service economy great for them, the lower classes have and always will bow to their every need. In fact, if the cost of service employees gets to high, then they can always push for more immigration, it is especially easy to get haitian or mexican labor to replace those high priced citizenry. It helps to give them a california drivers license. Most of these individuals were born into their position. Do not think for a minute Bill Gates was born into a low or middle class family in the suburbs.

By moving to a service economy where most of everything is imported, the middle class is left to struggle to maintain their status. More and more that is done with debt, easy credit for a good life now. Pay the rich forever.

Globalization is great for up and coming economies, it was great for Japan, but they are now losing to Korea, Indonesia, India etc.

The rich 1 percent would have you believe that this is all for the benefit of poor countries, ignoring the fact that when the labor costs and living standards rise in those countries, they'll be in the same boat. It will be a long time till we see programmers whose native language is Tutsi. But eventually they'll be a source of cheap labor too.

So what we have in effect is the very rich deciding the middle class is not dependant enough so they have decided to take from the middle and give to the poor.

Not exactly what Robin Hood advocated.

My experience in Bangalore...

[Anonymous Coward]

I work in Silicon Valley for a very large tech company, and in December 02 I spent a month flying hither and yon throughout India visiting all the major tech companies, so I think I can reasonably compare the two tech cultures.

Firstly, the big tech titans over there are ALL dependent upon the US economy. WiPro, TCS, Zensar, Infosys, etc. are all oriented towards the export market. The managers over there pay way more attention to the health of the US economy than to the economy there in India.

India has an amazing infrastructure for developing engineers. The IIT system, for example, is easily comparable to the best universities in the United States or elsewhere in the west.

My colleagues in India make significantly less than I do, yet they do live in quite comfortable middle-class-land. Yes, they do have servants, but in India, this is pretty common and not limited to techies.

The eagerness, drive and overall "geekness" of the technical people I worked with would be instantly recognized on /. - the geek drive seems to know no language or culture boundary.

Currently, the average work experience of the Indian engineers I'd been working with was pretty low - they were all in their early-to-mid twenties. What this meant was that most of the architecture and design work (and hence the "innovation") was created in the States, and then shipped overseas for the implementation. But they're very hungry, and very driven (as I said earlier) - I suspect that we'll start to see a lot more original development and design in the next 5-10 years as the tech base matures and gets some experience under its belt.

This is why those export companies (like Infosys) are now eager to not just position themselves as implementors but designers and innovators as well - they want to move up the tech "food chain" because there are about a dozen countries (in Eastern Europe, China, etc) that want to occupy that place in the Food Chain where India now sits.

The thing is that this offshoring business is actually possible because of the success of the Internet. I often work from my local coffeehouse when I'm not in the office, or telecommuting from home. If all I'm doing is slinging bits, does it really matter where I am? Often the answer is no...my saving grace (thus far) is that I don't work in an easily commoditized discipline.

I know one

[nnnneedles]

hotmail.com

At least it was an indian guy who created it. Sold it to microsoft for $400 million..

Bash it all you want, hotmail was pretty revolutionary and is probably used by hundreds of millions of people..

It will swing back to balance...

[jordandeamattson]

My observations below come from my experience managing a distributed software engineering organization with presence in San Jose, CA and Delhi, India. I have a total of about 25 people working for me with have in the US and have in India (think of that poor guy who is split between the two countries - that must be me with all of my travel between the two!).

Let's face it will swing back to balance over time.

Right now, there is an incredible head-count cost advantage to moving a project to India, with many companies doing. The drive to offshore to India is driving demand there heavily. It is difficult to hire quality people, wages are going up quickly, people are jumping between companies, and it is much like things were in Silicon Valley during the bubble years.

What we will see, is that the head-count cost advantage, over time, will narrow and the other costs of going off-shore will come into play (coordination, latency, frequent travel, etc.). As this happens people will become more and more selective about what goes and what stays.

In the long-term, I think "offshore outsourcing" will fade to a degree, while "internal offshoring" (building distributed development teams within your company. I believe that the trend towards distributed deveopment organizations that take advantage of cost differntials and cherry pick the best talent in various geographies (as hard as it might be to believe, not everyone wants to live in Silicon Valley or the US for that matter, I have an excellent manager, with US Citizenship, orginally from India who moved back) will continue and accelerate.

What does this mean for us in the US? It means that we will have to go up the "software value stack" and work at a higher level. If a task can be done somewhere else for less cost, it wll be. This mans that we have to be constantly working to be at the cutting edge and have the breadth and depth to add significant value and coordinate project in these distributed teams. In a sense we each have to take the role in our projects that Linus has in driving the development of Linux.

If it is any comfort, realize that we aren't the only ones feeling threatened. My friends in India are all worried and looking over their shoulders at places like China, Vietnam, Ukraine, etc. wondering how they will move to higher and higher value-add activities over time.

Election issue

[ToasterTester]

This hemoraging of jobs overseas has to become a prime election issue.

There was a good article on this topic in the Sunday L.A. Times pointing out it isn't only the Tech industry losing jobs overseas. All job levels and industries are sending services jobs overseas.

The Corporate CEO's and politicians they have in their back pockets only see improved operating costs, what they aren't seeing is they U.S. customers losing their jobs and won't be able to afford their products as time goes on.

Back when Alvin Tofler wrote _The Third Wave_ and said losing our manufactuing industry overseas isn't a problem, because America will become a Services based economy. Now we are losing our Services economy, but their isn't anything to replace it. The CEOs and politicians that cater to them need to open there eyes.

Outsourcing jobs overseas NEEDS to become a major issue in the upcoming elections. Every canidate needs to be informed of the issues and asked how they stand on it.

Bangalore outsourcing

[Unknown Kadath]

The company I work for, while incorporated in the US (for tax benefits and defense contracts, y'know), has the bulk of its employees in Bangalore. I, fortunately, have not had to work with the Bangalore office, since my work export control, meaning that foreign nationals can't work on it without special permission from the State Department. My coworkers on civilian projects, however, dread having to work with India. I'm not certain how much of it can be blamed on the Indian engineers themselves, and how much is the fault of poor communication, but all I ever hear about Bangalore is how often work needs to be sent back to be redone, and how inconvenient the time difference is.

Do the company savings on salary and benefits make up for having to redraw a set of design prints five or six times? I don't know. I do know it runs the American engineers ragged and frustrates our customers when there's a schedule delay. The interface between the US and India is the real rough spot, I think. I know that purely internal work in both countries goes smoothly, but not being able to use our huge labor pool in India is hurting the American side of the business. Maybe I'm able to look at things dispassionately because my job isn't going overseas, but I *want* international outsourcing to work...and it's a rough start for my company. We need to overcome language and cultural barriers (any American who thinks Indian English and American English are the same dialect has never spoken to an Indian) and establish some actual communication between the continents, instead of throwing a set of design requirements into the ether and expecting the Magic Overseas Engineers to sprinkle some pixie dust and suddenly have a working set of engineering drawings.

Is it different for IT work? I don't think coming up with design requirements for a program and then implementing them is a fundamentally different process than for a jet engine. ...I had a point when I started writing this.

On the other hand, the broken English of the company newsletter is occasionally hilarious.

-Carolyn

General Motors didn't worry about Japan until '80s

[barfomar]

The Big Three didn't worry about Toyota and Honda until the 1980's because of the low priced foreign competition. They rested on their laurels turning out mediocre cars at best.

They almost didn't survive. The result was A Good Thing for the consumer.

Now Japan has to worry about China, Korea and Taiwan doing the same thing to them.

It pays to go to work every day thinking it may be your last day there.

It's time to outsource executives

[number6.3]

Think about it. An Indian or a Pak executive will work for a lot less...and they certainly won't screw up^h^h^h^h^h^h^hmanage the company any better or worse than their overpaid American counterparts. Anyone interested in starting an executive outsourcing company with me? :)

Get rid of the minimum wage laws... RIIIGHT.

[Svartalf]

Do you have any idea of the HISTORY behind such laws? It's because employers would pay below subsistence wages to unskilled workers (as in not even really enough to live off of...) so that they'd have to work 12 or more hours in a day just to make enough money to barely live.

Not a pretty sight, really.

Now they're exporting that misery to the third world countries because they can and it nets a profit short-term for the businesses.

It amazes me how many "get a job" people are so clueless- because they're NOT IN THE SITUATION AND NEVER HAVE BEEN IN THE FIRST PLACE. They don't understand that many of these people that are "too good to work a real job" (By the way, define "real job" for me... If it's manual labor, then you don't understand what many actually did in the Tech fields- not all of them were "web developers" that got laid off, etc. Many of the people that got laid off had "real" jobs that were worth what they were getting paid for them until the Great Downsizing...) actually have obligations like houses and the such that many of what you'd consider "real" jobs won't even pay for an efficiency, let alone the obligations like car payments, insurance, etc.

If you've not been there, PLEASE do everyone a favor and shut the fuck up.

Good riddance to Silicon Valley!

[swordgeek]

OK this might upset some people, but that's too bad.

As a Very Large Company(tm), we outsourced our help desk a few years back. It was a painful running joke in the office that if you wanted to do no work done, you'd "phone India" with a problem.

The joke stopped justover half a year ago. Our India helpdesk is incredibly efficient at fixing problems, the staff are polite, and there's no bad attitude. I don't care how much money the company has saved--they have improved the quality of their internal support, and that's something pretty damned valuable.

So before everyone whines about 'cheap but crappy outsourcing,' make sure that it really is crappy. I'd wager that for all but the most highly skilled jobs, the overseas work is as good as anything locally.

Re:Perhaps you should practice what you preach...

[Svartalf]

I get busted all the time for my mistakes. Embedded systems don't play by the same rules as the desktop world stuff. A single mistake can go out to thousands of machines. In the case some of the systems I develop, a single mistake can KILL people. I do my level best not to make mistakes- just like those Hardware engineers you refer to. Keep that in mind the next time you think that all the software world is like frigging Microsoft or an apps vendor where people keep buying their broken crap.

Re:The rewarding of crap production ends here.

[Politburo]

A lot of people make comparisions between engineering and computer programming. I happen to work in an engineering firm, but have a degree in CS, so I am very aware of both sides of the analogy.

The analogy sucks.

The reason the analogy doesn't work is mainly because engineering deals with real-life physical problems. Also, engineering takes place in a realm of (generally) fixed possibilities.

You don't have to design a building to withstand 1,000 mi/h of wind because you know that will never happen. However, your program, to be anywhere near 'bug-free' (which can rarely be proven, of course) must be hardened against every combination of inputs. The effects of wind, and the behaviors of steel, etc. are very well known. You simply don't have this kind of data in programming, because you are almost always designing one-of-a-kind logic.

You make the implication that engineers don't make mistakes. That is far from the truth. The main reason why you don't hear about engineering mistakes is because of the massive QC effort that goes on. Most projects have at least 3 milestone levels, where plans are reviewed by the engineer's internal QC process, and then reviewed by the client's QC process. When you submit for jobs, part of your submission must document your QC process. No QC, no job.

If software companies put in anywhere near the same amount of effort on QC, you would see a definite improvement in software quality. However, it would be very difficult for software companies to achieve this. This is because the use of standards in engineering saves QC time by minimizing the amount of work that the reviewer must actually check. While many software companies do have internal standards and practices, the lack of industry-wide standards hinders the QC process. Libraries can assist here, but there is still a lot of unique logic being written for programs that simply isn't checked well enough.

People bitch about the costs of engineering (like the Big Dig), but fail to realize that more than 50% of the time is spent checking the work. A lot of money is spent to ensure that these things are safe. If you want a Mozilla or a Real Player that doesn't crash, I hope you're prepared to pay for it.

I don't know where your bitterness against programmers comes from, but you need to chill out (and it sounds like you could stand to learn a lot from a software engineering course).

Note: Many of my comments are in the context of public engineering projects. For private projects, plans are reviewed (in New Jersey) by the local Planning Board, as well as the Department of Community Affairs, a state agency.

Re:Yeah, Tax incentives

[Ryosen]

Corporations do not get tax incentives for outsourcing

Wrong.

Corporations are not required to pay labor/payroll tax on workers who are nationals of other countries.

Corporations are allowed to deduct the cost of outsourcing off of their reported earned income, thereby reducing their tax liability.

These are very strong, cost-saving incentives for a company to outsource to another country. The loss in tax revenue is made up by the rest of the citizenry.

No bullshit with unions
There are no IT unions in the US.

no messy healthcare
While the healthcare system in the US might need some work, an employers relationship is limited to paying the premiums.

no worries about ADA, OSHA, EEOC, Afirmitave action
Yes, protecting the rights of an indivudual from discrimination and harrassment is just plain wrong. Until you become that individual. Perhaps you're too young to remember such agencies as TaTa and others and the disgusting manner in which they treated their employees, sent to the US and elsewhere as endentured servants. If you think that regulatory agencies are the primary motivating factors for outsourcing, you really are not understanding how corporations work.
And OSHA?? What does the Occupational Safety and Health Administration have to do with IT?

Why just stop Corporate Welfare, when you can stop ALL Welfare!
This is an asinine statement, to be sure. But just in case you truly don't understand the reason for welfare, just know that there are still some people in this world that feel they have a responsibility to help their fellow man. Beyond that, there are very compelling reasons for providing public assistance in any society.

Without "Corporate Welfare" of reasonable taxation, the Corps will go overseas.
Again, nonsense. Companies have been operating in the US for over 300 years. While there have always been deals, favors, and preferential treatment afforded to corporations, I cannot think of a single instance where a major corporation packed up their operations and moved overseas. I'm sure there has to have been a couple, but they obviously did not have much of an impact. Ford might be making cars in Mexico, but the bulk of their operations is in the US.

The "working class" and the poor will finaly have to start paying thier fair share of taxes to support their way of life
Let me assure you, they already do. They may not pay the same dollar amount but, percentage-wise, they pay the same, if not more. In fact, most poor people do not have the financial means to obtain the majority of tax deductions that higher income families do. But if you insist on sticking with your ill-conceived opinion that they are not "paying their fair share", consider the fact that its the poorer people who are doing the jobs that you don't want to.

There will be no more greedy capitalists left to subsidize your welfare way of life.
Wow, you really do have a lot of disdain for lower-income people, don't you?

What makes YOUR work worth more than the same quality work from India? The fact that you are an American?
Historically? American corporate history is rife with examples of the failures of outsourcing. Many industry watchers regard outsourcing as a bad idea. Not just for the displaced workers but for the companyies themselves. Maybe someday people will learn that cheaper does not equal better.

No one owes you a living. No one owes you a living wage. The accident of your birth does not grant you a right to the fruits of my labor. Nor does the fact that you are my neighbor require me to buy your products.
No one is "owed" anything and no one is claiming that here. While American IT workers are affected by outsourcing, it is a short-term problem. Some salary adjustments have to be made, it's more difficult to find work, might have to move, but it can be done.

The bigger concern is the shortsidedness of cor

The answer to why?

[sameerdesai]

India is a cheap country to live in and I know it because I lived there. Yes you can say that you get very less pay than what you get in US but then you should also look at expenses. You spend more than half of your salary into taxes, rents, and payments of other kinds which is not the case in India. The saving there are tremendous. And you can end up saving more than here. The reason jobs keep on moving to India are significantly many some of which are: 1) 1 US Dollar = 50 Indian Rupees (approx) 2) You have to pay there much less than here in US. As for e.g. If I get paid here in US 5000 bucks a month, this translates to nearly 250,000 Indian Rupees. A salary of more than 25,000 Indian Rupees a month is considered more than excellent. 3) Excellent cheap labor. There are many educated people there whose primary language is English and can effectively deliver the goods. The economic condition is improving drastically and it does not surprise me why companies want to move jobs to countries like India and China with the very reason why we are seeing such a jump into Jobs @ Bangalore.