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The Outsourcing Bogeyman

HS Thomas
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The Outsourcing Bogeyman

It is easy to praise economic globalization during boom times; the challenge, however, is to defend it during the lean years of a business cycle. Offshore outsourcing is not the bogeyman that critics say it is. Their arguments, however, must be persistently refuted. Otherwise, the results will be disastrous: less growth, lower incomes -- and fewer jobs for American workers.


McKinsey Global Institute has estimated that for every dollar spent on outsourcing to India, the United States reaps between $1.12 and $1.14 in benefits. Thanks to outsourcing, U.S. firms save money and become more profitable, benefitting shareholders and increasing returns on investment. Foreign facilities boost demand for U.S. products, such as computers and telecommunications equipment, necessary for their outsourced function. And U.S. labor can be reallocated to more competitive, better-paying jobs; for example, although 70,000 computer programmers lost their jobs between 1999 and 2003, more than 115,000 computer software engineers found higher-paying jobs during that same period. Outsourcing thus enhances the competitiveness of the U.S. service sector (which accounts for 30 percent of the total value of U.S. exports). Contrary to the belief that the United States is importing massive amounts of services from low-wage countries, in 2002 it ran a $64.8 billion surplus in services.

So there you have it ; the number of programming jobs has just doubled. As will any other job you can think of :
[ March 24, 2004: Message edited by: HS Thomas ]
Rufus BugleWeed
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I have been seeing these type of arguments, that outsourcing is wonderful, quite a bit lately. There was a guy on the nightly business report last night with a similar attitude. I wonder why an indicator like consumer confidence goes so contrary to this fellows theory. How could so many people in the economy be finding the job market so poor when this guy says it is booming?
How on eath does he find the 70K and 115K numbers?
Tim Holloway
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  19

Lies, Damn Lies and...
It's not just that everyone has their own agenda. The true extent is spread over such a wide area in both time and space that even assuming everyone agreed on what to count, it's virtually impossible to count it.
I have a fundamental scepticism on any report that claims that either positions filled OR salaries rose (though I note that they're fudging, by counting back before the implosion). Not just because it conflicts with the Gartner and Forrester data (for whatever they're worth). What really counts are the people I know and encounter everyday and what's happening to them. So far, I see a lot of fear, watch a lot of layoffs, even some offshoring. But relatively little positive info.
Riding the bus is often educational. It's a skewed sample, because many of the riders are employed by one or the other of a handful of major companies downtown. That bus is getting awfully empty these days and it's not coming after the riders discussed the new BMW's they're buying.
One last-day rider I heard last week already has a new, non-offshorable service-industry job waiting. She's going from Corporate America to a job in a flower shop. No benefits, though. After 30 years service. The department was cut down to 1/3d the original size and is now being outsourced. Our Brave New World.
What really unsettled me though was I report I read this morning indicating that many of the tech companies are showing improved numbers not because of increased business, but because of cost-cutting. We should be beyond that by now.


Customer surveys are for companies who didn't pay proper attention to begin with.
frank davis
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Joined: Feb 12, 2001
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Originally posted by HS Thomas:

The Outsourcing Bogeyman

So there you have it ; the number of programming jobs has just doubled. As will any other job you can think of :
[ March 24, 2004: Message edited by: HS Thomas ]

You need a smiley face icon to let us know when you're joking. If read carefully, there's very little to disprove the commonly held assertion that the US IT industry is getting ravaged.
Steven Broadbent
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Joined: Dec 10, 2002
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McKinsey, well enough said then. Look forward to the reaction when their consultancy "jobs" are outsourced.


"....bigmouth strikes again, and I've got no right to take my place with the human race...."<p>SCJP 1.4
HS Thomas
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Well, this kind of analysis is what governments seem to be acting on. The IT jobs to look for would seem to be in government,Research and Development or small dot com type companies. Technical Colleges don't seem to be teaching the new stuff ; perhaps they will later. Universities don't teach pure Computer Science - CS students take up some CS courses and add Financial options to give them the option to get into Investment Banking ( example taken from students from Imperial College - one of the top Universities in UK - which is a shame because previously if you took up CS you did pure CS at Imperial College)

So where will the next Researchers come from ? China ? IBM Global Services?
Open Source ?
IBM on their own hardly do any good research without referring to research at good Universities.
The other thing one hears is that there are jobs in management - er, what exactly are they managing ?
[ March 24, 2004: Message edited by: HS Thomas ]
HS Thomas
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Then again, who would complain if Proctor & Gamble, for instance, wanted to profit by $500 million rolling a product out globally instead of a paltry $45 million rolling it out in the US only.
Or Walt Disney wanted to repeat the US box office hits matched by profits at the same time round the globe instead of waiting till later when something else would have come along.
Easier said than done.
Tim Holloway
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  19

Originally posted by HS Thomas:


So where will the next Researchers come from ? China ? IBM Global Services?
Open Source ?

I think Open Source is closer to the mark. The capital requirements for CS research are pretty modest these days (unless you're into custom hardware platforms). Although physical presence has historically been required, that's just because the best research occurs where there's communication. Now it's just a matter of finding a place where like-minded people hang out on the Internet.
Like Javaranch.
However, it's the open communication that matters most, not open source. Just because you meet up with people in an open forum doesn't mean that you can't do the actual brainstorming and development on a side channel and release the results commercially. Not presently very common, but that could change.
This is, in fact, what I was doing with someone about 3000 miles away last Summer before his Indian friends down the block undercut his prices and made him give it up. He wanted to try setting up an offshore development shop himself, but he didn't have any friends or relatives in the right countries like they did.

The other thing one hears is that there are jobs in management - er, what exactly are they managing ?

Offshoring, of course
Actually, that's not funny. It's the managers who're the biggest target in one of the larger downsizing efforts going on in this town right now.
[ March 25, 2004: Message edited by: Tim Holloway ]
HS Thomas
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On page 5 : - In 15 years offshoring will be but a distant memory.

The problem of offshore outsourcing is less one of economics than of psychology -- people feel that their jobs are threatened. The best way to help those actually affected, and to calm the nerves of those who fear that they will be, is to expand the criteria under which the Trade Adjustment Assistance (TAA) program applies to displaced workers. Currently, workers cannot apply for TAA unless overall sales or production in their sector declines. In the case of offshore outsourcing, however, productivity increases allow for increased production and sales -- making TAA out of reach for those affected by it. It makes sense to rework TAA rules to take into account workers displaced by offshore outsourcing even when their former industries or firms maintain robust levels of production.
Another option would be to help firms purchase targeted insurance policies to offset the transition costs to workers directly affected by offshore outsourcing. Because the perception of possible unemployment is considerably greater than the actual likelihood of losing a job, insurance programs would impose a very small cost on firms while relieving a great deal of employee anxiety. McKinsey Global Institute estimates that such a scheme could be created for as little as four or five cents per dollar saved from offshore outsourcing. IBM recently announced the creation of a two-year, $25 million retraining fund for its employees who fear job losses from outsourcing. Having the private sector handle the problem without extensive government intervention would be an added bonus.
THE BEST DEFENSE
Until robust job growth returns, the debate over outsourcing will not go away -- the political temptation to scapegoat foreigners is simply too great.
The refrain of "this time, it's different" is not new in the debate over free trade. In the 1980s, the Japanese variety of capitalism -- with its omniscient industrial policy and high nontariff barriers -- was supposed to supplant the U.S. system. Fifteen years later, that prediction sounds absurd. During the 1990s, the passage of NAFTA and the Uruguay Round of trade talks were supposed to create a "giant sucking sound" as jobs left the United States. Contrary to such fears, tens of millions of new jobs were created. Once the economy improves, the political hysteria over outsourcing will also disappear.
HS Thomas
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A discussion not so long ago
Office space in Bangalore is cheaper than Mumbai; and as Walter Rumsby knows the Mumbai IT sector is located in a special suburb.
I'm in Sri Lanka now buying land to build a house and prices for land vary from $6-$7 a square foot in the country to $300 a square foot in central Colombo. Commuting is a nightmare which explains the difference.
There are also massive differences in land prices in the States. A colleague of mine has got a house on 3 acres in Long Island; says it's worth about a quarter of a million. That's a hell of a lot cheaper than land in a suburb of Colombo.


"What the media won't tell you, because they're lazy sob's, is how many new jobs we're likely to generate in that same time period."
WHAT jobs? This is a serious question. We've pretty much outsourced the manufacturing economy, now we're outsourcing the service economy. What else is there?
I go back and forth between believing the sky is falling and then thinking I'm overreacting. But I really don't see a way around the trend that many of the highest paying jobs requiring the most education are now perfect candidates for outsourcing, and I honestly don't see what's going to replace that.


Here's an interesting quote from the linked article:
>>> "Our aim here is not cost-driven," he said. "It's to build a 24/7 follow-the-sun model for development and support. When a software engineer goes to bed at night in the U.S., his or her colleague in India picks up development when they get into work. They're able to continually develop products." <<<
What kind of development fits this model? I do recall a decade or so ago when people thought they could devise software factories where software could be developed on an assembly line. The idea is nonsense, but this makes it sound like management still believes in it.

"What kind of development fits this model?"
Most likely, this is just Oracle management trying to make people think they're not really replacing American jobs with overseas jobs.

It would be funny if it weren't all too true.
[ March 25, 2004: Message edited by: HS Thomas ]
HS Thomas
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FOG CREEK SOFTWARE Really interesting discussion. Hey not all software developments in India are on offshored projects! Those who like to think outside the box work on local projects. And Indians officially cannot buy books from amazon.
Offshoring
Have you given any thought to offshoring any of your development? If not, is it because you would prefer not to or because it would not benefit fog creek's bottom line?
Kevin Clary
Thursday, February 26, 2004
We will not be "offshoring" our software development because you don't outsource your core competency. I'm not a software broker, I'm a software developer.
Maximum Overdrive
Wednesday, March 03, 2004
In the next few years you will see more and more software products coming out of Eastern Europe and India because the local companies have earned enough money to sustain serious product development.
[ March 25, 2004: Message edited by: HS Thomas ]
HS Thomas
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JOEL ON SOFTWARE : The best advice I can offer:
If it's a core business function -- do it yourself, no matter what.
Pick your core business competencies and goals, and do those in house. If you're a software company, writing excellent code is how you're going to succeed. Go ahead and outsource the company cafeteria and the CD-ROM duplication. If you're a pharmaceutical company, write software for drug research, but don't write your own accounting package. If you're a web accounting service, write your own accounting package, but don't try to create your own magazine ads. If you have customers, never outsource customer service.
If you're developing a computer game where the plot is your competitive advantage, it's OK to use a third party 3D library. But if cool 3D effects are going to be your distinguishing feature, you had better roll your own.
The only exception to this rule, I suspect, is if your own people are more incompetent than everyone else, so whenever you try to do anything in house, it's botched up. Yes, there are plenty of places like this. If you're in one of them, I can't help you.
Tim Holloway
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  19

This time it is different. Last time, we just worried about being supplanted. This time there are documented cases (like Boeing's tech writers) where jobs definitely have transferred. Also, the length of the dry spell has been much longer and the average length of unemployment much longer. Plus the hiring salaries are off. History almost never repeats itself exactly.
What hurt me was that in those earlier recessions, I was able to work as a consultant. Onshore consulting firms have now all but dried up and blown away. I'd never spent more than 7 continuous months without a paycheck durings the 80's and 90's.
So personally, speaking, it's a whole lot different. And from what my myopic little eyes can see, I'm not alone.
The big question all along has been how much of the current job crunch is due to companies getting labor offshore and how much is due to companies simply not employing laborers at all. Only a true recovery will bring that distinction into relief.
The whole idea of "hot-bedding" software makes me ill, because it's most commonly promoted by those who subscribe to the "Hamburger Grinder" school of software production. Besides, I'm working on a project where one member's in Germany and one's in Australia. We actually lose time due to playing mail-tag. We don't care, however, since we're delivering for quality, not for time. Which is pretty much the opposite of most commercial efforts these days.
Why can't Indians buy books via Amazon.com?
HS Thomas
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Originally posted by Tim Holloway:

Why can't Indians buy books via Amazon.com?

Not sure. Fear of half the country's GNP being spent on Amazon?
The East is notoriuos for being avid readers.
It has been a long time Amazon.com-ing to India
Amazon.com-ing to India
Amazon.com, the world's largest virtual bookstore, has applied to the National Centre for Software Technology (NCST), for registering the domain name amazon.co.in, to ensure it is not misused. The ``.co.in'' name is typcially given only to Indian companies or companies which have an Indian presence.
[ March 27, 2004: Message edited by: HS Thomas ]
Jeroen Wenting
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uh, is it Amazon not wanting to sell to India or India refusing the allow goods purchased from Amazon to enter the country?
Or are Indians just cheap and don't want to spend US prices on books seeing they have all those cheap Indian editions at home?


42
HS Thomas
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Looking at some sites for computer books in India there doesn't seem to be any lack of titles. E-books for the Palm Pilot seem to be more than adequate.
It just seems from a bloggers comment in the link above that officially they cannot buy from Amazon. Which sounds weird but is it ?
The sites seem to have messages to the effect that unlisted books from foreign publishers can be requested. Can the Indian Postal/Delivery Services handle being bombarded by sheer volume of Amazon orders ?
HS Thomas
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The Royal Doulton is closing it's last British factory.
Henceforth the company will produce it's work in the Far East.
Royal Doulton
Smashes China
Personally favoured Noritake for some time, but just too expensive.
I guess the West is on the look out for the next big names in pottery to nurture. And the same with toys.
[ March 29, 2004: Message edited by: HS Thomas ]
Don Stadler
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Originally posted by Tim Holloway:

This time it is different. Last time, we just worried about being supplanted. This time there are documented cases (like Boeing's tech writers) where jobs definitely have transferred. Also, the length of the dry spell has been much longer and the average length of unemployment much longer. Plus the hiring salaries are off. History almost never repeats itself exactly.
What hurt me was that in those earlier recessions, I was able to work as a consultant. Onshore consulting firms have now all but dried up and blown away. I'd never spent more than 7 continuous months without a paycheck durings the 80's and 90's.

I have a feeling that the tech crunch in 1981-83 was pretty similar to this one. I was just entering the job market (or not succeeding in entering) at that time so I can't speak for the experienced people of that era. But on one of my earliest jobs I saw a COBOL guy laid off in a cutback which otherwise dumped the least experienced people at the shop. The same cutback put me out of work for four months which was my longest period of unemployment before last year.
The problem then was a strong dip in demand compounded by a mismatch of skills. Most of the laid off people had mainframe skills while the new jobs were in things like Unix, C, and Oracle work. No outsourcing that time, but the pain was as great.
Originally posted by Tim Holloway:

So personally, speaking, it's a whole lot different. And from what my myopic little eyes can see, I'm not alone.
The big question all along has been how much of the current job crunch is due to companies getting labor offshore and how much is due to companies simply not employing laborers at all. Only a true recovery will bring that distinction into relief.

I suspect the bulk of the pain is caused by similar causes to those in the earlier tech crunch. The offshoring adds to the problem of course, but I think it's not the major causative factor.
sunitha reghu
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Originally posted by Jeroen Wenting:
Or are Indians just cheap and don't want to spend US prices on books seeing they have all those cheap Indian editions at home?

Let us say you in Borders and saw the latest novel of John Grishm. Two editions one for $25.00 and another low quality edition for $ 2.5. Which one you buy. I will definitely go for $ 2.50 .
But if I want a sneaker I wont buy a wallmart brand, I will go for a nike or anything like that. Hope you got my point.
"I HATE THE WORD [CHEAP]"
[ March 29, 2004: Message edited by: sunitha raghu ]
HS Thomas
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Cheap as in low cost.
Bangalore's scientists have made a cheap computer called the Simputer.Simputer for the poor goes on sale
It was developed by scientists and engineers at the Indian Institute of Science in Bangalore who were looking for a way of taking the internet revolution to India's rural masses.

[ March 29, 2004: Message edited by: HS Thomas ]
Tim Holloway
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  19

Originally posted by Don Stadler:

I suspect the bulk of the pain is caused by similar causes to those in the earlier tech crunch. The offshoring adds to the problem of course, but I think it's not the major causative factor.

To repeat. No it wasn't. I was there. And actually in the time frame you mentioned, the golden jobs were in things CICS and JES internals. The PC market was just getting started.


The Simputer is a neat little device and rumor has it that it may now be possible for Westerners to get ahold of them.
It takes into account the limitations of the poorest parts of India. Runs on batteries so as not to be dependent on limited/non-existent local power grid. Uses a "memory-stick" type of technology so that multiple users can share the device by swapping personal memory. And it was designed with the multiplicity of local alphabets (and illiteracy) in mind.
The downside is that a lot of what it can do, my aged Handspring Visor can do as well, and it was about half the price of the Simputer brand new.
I'd love to find a book for $2.50 these days! But the #1 reason I buy paperbacks is because they take up less space. One day my house is going to explode...
HS Thomas
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The Handspring Visor costs about $68/= . Optional extras do add up to a tidy sum. A family of 10 can have one Simputer and 10 memory sticks.
How Can You Use A PC If You Can't Even Read?


To make the Simputer affordable, the team had to take a different approach from that used in normal commercial PC development. "In any large corporation, such a hardware design would have cost several million dollars," says professor Swami Manohar, another member of the group. Instead, they formed a nonprofit trust (www.simputer.org), scrounged funding and technical facilities, and used free "open source" software. They do not plan to manufacture the Simputer themselves. Instead they will license the design, charging around $25,000 to commercial producers in developing countries, 10 times that elsewhere. Nonprofit use will be free. A number of Indian companies, including Bharat Electronics Limited, Wipro and TVS, are considering mass production.


[ March 29, 2004: Message edited by: HS Thomas ]
Don Stadler
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To repeat. No it wasn't. I was there. And actually in the time frame you mentioned, the golden jobs were in things CICS and JES internals. The PC market was just getting started.

Could be. I knew a CICS expert at that time who was doing very well. I suspect the bulk of the COBOLers who didn't know the fancy stuff weren't doing as well, however. True?
HS Thomas
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Some maths Offshoring work
Some real offshoring experience : How Offshore Outsourcing Failed Us


I've heard anecdotal evidence about bad offshoring experiences, but obviously those are the anecdotes you'll hear.
Someone pointed it out on this forum, and I think it's a critical insight - evaluate "success stories" *very* carefully. Make sure the "massive cost savings" isn't based on an hour-for-hour comparison. For example, let's say development of an in-house HR system would have taken 1000 manhours for a local consultant @ $50/hr. Offshored, it took 2500 manhours @$30/hr. Of course, the after-action report is going to claim 2500 x (50-30) = $50k savings, instead of the (unmeasurable) (30 x 2500) - (50 x 1000) = $25k loss.
No telling if the offshore team will overrun, match, or beat the hours required, but by doing the math on the assumption that it's a match, then offshoring will *always* be a fiscal win, no matter the actual effect.




"If things were spread equally, the Indians would be a little better off, and the average American would be maybe 90% poorer - but that cannot happen, simply because we have so much wide open space and natural resources - we just can't physically get to the point where beggars pay rent to live on squares of sidewalks like people do in Calcutta."
Here's an idea. Let's create MORE wealth so both Americans and Indians have enough to live nicely.
Too radical?
Jim Rankin
Thursday, October 23, 2003
---"If things were spread equally, the Indians would be a little better off, and the average American would be maybe 90% poorer"-----
Err, somebody's mathematics are at fault here. The average GNP for an American is about sixty times that for an Indian. So if there were one Indian for one American than tthe average Indian would be thirty times better off and the average American half as rich. As there are four Indians for every American, then the average Indian would be seven times better off (which is hardly "a little").
Same lack of mathematics comes in when people keep talking about the US economy collapsing because 3.5 million jobs will be outsourced to India by 2015. Even if the labour force in the States remained static, and it has been increasing almost every year since 1776, that would still only represent less than 2% of the whole US work force.
Stephen Jones
Thursday, October 23, 2003


[ March 30, 2004: Message edited by: HS Thomas ]
Arjun Shastry
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Harvard planning to open R&D Center in Pune India
PUNE: The mother of all business schools will soon be in India. Well, almost. The world's most sought-after business school has decided to open a new research centre in India, to help develop case studies to train the global managers of tomorrow.
While a final decision is yet to be reached, it is learnt that the centre will be located either in the country's business capital Mumbai, or IT capital Bangalore.
When the centre opens, it will be Harvard Business School's (HBS) fourth international research centre. The first was opened in Hongkong, the second in Buenes Aires. The third was opened in Tokyo just two years ago.
Why India? It was logical, said Prof Warren McFarlan, senior associate dean of HBS and the man who started teaching HBS' first course in IT management back in 1962.
"India is not just about IT or business process outsourcing. We see it as an incubator for giant global corporations driven by IT strategy."
Times Of India
Not sure,what they are going to do.Some American schools have already started MBA programs through small shops.Harvard seems to be another one.


MH
HS Thomas
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it is learnt that the centre will be located either in the country's business capital Mumbai, or IT capital Bangalore.
Mumbai would seem to logically be the place for it. Being placed too close to IT could kill off steam. Unless business and IT need to be closely integrated.
I did expect something like this , knowing that India actually excels in producing business ideas ( than it does in IT perhaps )
[ March 30, 2004: Message edited by: HS Thomas ]
Tim Holloway
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  19

Originally posted by Don Stadler:

Could be. I knew a CICS expert at that time who was doing very well. I suspect the bulk of the COBOLers who didn't know the fancy stuff weren't doing as well, however. True?

I'm afraid I didn't notice. I was in mainframe tech support doing assembly language. But I do recall the president of our company telling us at a companywide meeting about then that recessions were good for us because in lean times companies looked to cut costs by computerizing.
It was the late '80s/90s recession that was the first time I felt any pain. That was when all the companies were going to "downsize their way to greatness". I'd left my "job-for-life" position to go back to school and found it difficult to get a job afterwards. Finally had to move to another city, but I worked various contract and perm jobs and was never more than 5 months between paychecks. There's a lot of difference between 5 months and 28 months.
Also never had to take a pay cut like I did this time around.


My Handspring was a Visor Deluxe and it ran $250 new (when the last one wore out, I got a replacement for $80 on eBay). It has the SpringBoard slot in it. I noticed that the Simputer has gotten cheaper, however. Also added memory, I think.
HS Thomas
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Originally posted by Tim Holloway:



My Handspring was a Visor Deluxe and it ran $250 new (when the last one wore out, I got a replacement for $80 on eBay). It has the SpringBoard slot in it. I noticed that the Simputer has gotten cheaper, however. Also added memory, I think.

The "inventors" are trying to follow the success of the radio in rural places. Broadcasting news in different languages, agri and cultural programmes etc.
At 200$ (approx 9-8000 Rs) seems too steep a price for rural communities anywhere. An English farmer would think twice about paying that kind of money when struggling to keep a farm going.
I guess the marketeers would have to bring the price down considerably.
Benefits are it reads e-mails out to you therefore don't need a lot of literacy to increase knowledge. Hope they've built Spam filters into the things, though.
One product to watch.
For an inter-connected world there is great need for such products: Someone sneezes in China and the effects ripple round the world. (remember SARS).
e-Voting may take off in a big way in Europe (the US has been a bit wary since the Florida elections).Someone in the Third World (read rural areas in countries like India) may have something to say about certain European policies that affect them. Assuming Europe can cope , which I doubt it can , if such events unfold. I think Europe could do with a similar affordable product - events in Kossovo and Uzhbekistan are starting to hit headlines once again.
Politicians have never had such instant access to people's feelings on such topics before or people to news and knowledge.
[ March 30, 2004: Message edited by: HS Thomas ]
HS Thomas
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It was the late '80s/90s recession that was the first time I felt any pain.
I should think a causative might have been GW I - Gulf War I. And mysteriously very large relational databases hit the scene.
Don Stadler
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Originally posted by Tim Holloway:

I'm afraid I didn't notice. I was in mainframe tech support doing assembly language. But I do recall the president of our company telling us at a companywide meeting about then that recessions were good for us because in lean times companies looked to cut costs by computerizing.

Perhyaps it was the locality. I was based in Milwaukee where the manufacturing sector was dominant. The heavy industrial companies had been mainframe computerizing in a big way when they found themselves fighting for their lives. They laid off a batch of computer people as well as the hardhats and managers. It was grim.
When things like this happen in places like Boston and California it seems to get a lot more attention than when the industrial heartland gets hit. Or Florida. Funny how that works, eh?
Originally posted by Tim Holloway:
It was the late '80s/90s recession that was the first time I felt any pain. That was when all the companies were going to "downsize their way to greatness". I'd left my "job-for-life" position to go back to school and found it difficult to get a job afterwards. Finally had to move to another city, but I worked various contract and perm jobs and was never more than 5 months between paychecks. There's a lot of difference between 5 months and 28 months.
Also never had to take a pay cut like I did this time around.



I hear you brother. I'd never had more than 3 months down time between 1985 and 2001 and that long only once. Two weeks or a month was more typical when I had any downtime at all. Often it was finish on Friday start on Monday elsewhere.
This time it was 8 months, a real shock. And a major pay cut too.
[ March 31, 2004: Message edited by: Don Stadler ]
Rufus BugleWeed
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Posts: 1551
I made time to read the whole article today. If people would not just pick out and sieze the parts of Dezner's article that meet their agenda, IMO, Denzer is right on the mark.
I'm not quite sure what he means by an insourced job. Is an insourced job the opposite of an outsourced job? Or is an insourced job an H1-B/L1 nonimmigrant?
Most of the numbers thrown around are vague, overhyped estimates.

I see he answered my question posted above.
Cushioning this process (outsourcing) for displaced workers makes sense.

IMO, this doesn't happen. Does anybody know of anyone in IT that's been helped by TAA or how to apply for it?
HS Thomas
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Joined: May 15, 2002
Posts: 3404
What agenda do you mean, Rufus ?
I doubt offshore outsourcing is going away. It's not just cost - there are too many long-term benefits in it's favour. The (relatively smaller) losses will be ignored. That does not mean there won't be any onshore development in the future, either. Creativity in software seems to be the West's forte at the moment.
[ March 31, 2004: Message edited by: HS Thomas ]
Rufus BugleWeed
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Joined: Feb 22, 2002
Posts: 1551
I mean that agendas like
recent testimony by N. Gregory Mankiw, the head of President George W. Bush's Council of Economic Advisers. No economist really disputed Mankiw's observation that "outsourcing is just a new way of doing international trade," which makes it "a good thing."

will quote statements like
McKinsey Global Institute has estimated that for every dollar spent on outsourcing to India, the United States reaps between $1.12 and $1.14 in benefits. Thanks to outsourcing, U.S. firms save money and become more profitable, benefitting shareholders and increasing returns on investment.

Even if the most negative projections prove to be correct, then, gross job loss would be relatively small.

and will forget/neglect to mention
The best way to help those actually affected, and to calm the nerves of those who fear that they will be, is to expand the criteria under which the Trade Adjustment Assistance (TAA) program applies to displaced workers.

[qoute]Another option would be to help firms purchase targeted insurance policies to offset the transition costs to workers directly affected by offshore outsourcing.
sunitha reghu
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Joined: Dec 12, 2002
Posts: 937
Outsourcing actually creates U.S. jobs, study finds
Jason Stull
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Joined: Feb 02, 2004
Posts: 47
The MSN article quotes from "The Information Technology Association of America", which is an IT Industry trade group. Essentially, Micrsoft is quoting itself. I question the source. Check this out:
Disinfopedia


"I believe in coyotes and time as an abstract Explain the change the difference between What you want and what you need there's the key"
Tim Holloway
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Joined: Jun 25, 2001
Posts: 15951
    
  19

An English farmer would hesitate to spend $200 for a productivity aid? I don't think you've priced combine harvesters. $200 is about one year's income in parts of India and China. A Combine is about 10 years (after-expense) income for a family farmer. To say nothing of the amount of fuel it consumes. Farmers are big into co-ops.
And that's also the intent behind the Simputer. Not a "PC", but something that gets passed around the village with each person's stake on a relatively inexpensive memory stick. A similar industry already exists. Someone buys a cel phone and rents it out to the village.
It wasn't all that long ago that I read that IT was already making a difference to milk producers near Bangalore. Not only were they better able to allocate production resources, but less milk was being wasted due to local overproduction. India is not a country where it's a good idea to waste food. Assuming any country is!

It was the late '80s/90s recession that was the first time I felt any pain.

I should think a causative might have been GW I - Gulf War I. And mysteriously very large relational databases hit the scene.


By the time the push began for the invasion of Iraq, I was already back on the payroll. The big thing back then was the race to see who could "right-size" the most. It finally ended when the right-sizers realized that they were having to hire people they'd laid off to work for contract wages at a premium once business picked back up.
It's true about one thing, though. I moved downstate to get a job back in '88. Jobs were slim, but there were places you could go. This time, the whold nation seemed equally hard-hit, and there was no place to mvoe to.

Politicians have never had such instant access to people's feelings on such topics before or people to news and knowledge.


Oh, I dunno. An angry mob outside the castle gates is a pretty good indication of feelings
It's not what you know, but what you do about it that ultimately counts. Sometimes a majority viewpoint is a "focus group" and can be ignored while a minority that agrees with you is a "mandate".
HS Thomas
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Joined: May 15, 2002
Posts: 3404
Originally posted by Tim Holloway:
An English farmer would hesitate to spend $200 for a productivity aid? I don't think you've priced combine harvesters. $200 is about one year's income in parts of India and China. A Combine is about 10 years (after-expense) income for a family farmer. To say nothing of the amount of fuel it consumes. Farmers are big into co-ops.

I was thinking of the poorest English farmer who one could compare with a rural Indian farmer. Lots went bankrupt and sold off their farms. Doubt the Simputer would have helped, still... one can never under estimate the power of tech.

Oh, I dunno. An angry mob outside the castle gates is a pretty good indication of feelings


[ March 31, 2004: Message edited by: HS Thomas ]
HS Thomas
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Joined: May 15, 2002
Posts: 3404
Trade Adjustment Assistance for Firms seem to cater to manufacturing industries only.
Jason Stull
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Joined: Feb 02, 2004
Posts: 47
Just got the word over the radio yesterday that Best Buy will be packing up it's entire IS department and shipping it to India. 900 people will be getting the keys to the streets here in Minnesota.
HS Thomas
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Joined: May 15, 2002
Posts: 3404
No one boycotting Best Buy and opting for Walmart instead?
No more National Buy Nothing Days on Black Fridays?

Doesn't look as if any producer of programming goods is doing that anywhere !
Re-skill to the next offshore project.
 
I agree. Here's the link: http://aspose.com/file-tools
 
subject: The Outsourcing Bogeyman