Replies to IEEE USA's relatively protectionst views -- or not

[Declan McCullagh <declan () well com>]

-------- Original Message --------
Subject: Re: [Politech] IEEE's relatively protectionst views on offshoring
Date: Fri, 19 Mar 2004 12:37:05 -0500
From: Steven Cherry <s.cherry () ieee org>
To: Declan McCullagh <declan () well com>
References: <405A99EF.8060907 () well com>

Declan, your subject line prompts me to note that the IEEE-USA is one
organization within the IEEE. More than half, but fewer than
two-thirds of all IEEE members are located in the U.S. The long-term
trend is a faster increase in non-North American membership.

That said, I'm not sure how fair it is to call IEEE-USA's position
"protectionist." They're concerned with the huge and rather sudden
jump in electrical engineering unemployment, all out of synch with
the economy as a whole. When EE unemployment is significantly bigger
than the national average, despite historically being half as large
or even less, something troubling is going on. Increased outsourcing
is one concern, there are plenty of others.

  Steven
--

--
  Steven Cherry, +1 212-419-7566
  Senior Associate Editor
  IEEE Spectrum, 3 Park Ave,  New York, NY 10016
  <s.cherry () ieee org>  <http://www.spectrum.ieee.org>





-------- Original Message --------
Subject: Re: [Politech] IEEE's relatively protectionst views on offshoring
Date: Fri, 19 Mar 2004 14:45:42 +0530
From: Suresh Ramasubramanian <suresh () hserus net>
Organization: -ENOENT
To: Declan McCullagh <declan () well com>
References: <405A99EF.8060907 () well com>

Declan McCullagh  writes on 3/19/2004 12:27 PM:
>
>
> WASHINGTON, March 18 /U.S. Newswire/ -- Offshoring contributes to high
> unemployment levels among U.S. technologists, and poses a serious,

Just a question - which may or may not be dumb.

Is this the stated opinion of the IEEE, or that of the US chapter of
IEEE?   And does the US chpater of IEEE speak for itself, or for the
worldwide membership of IEEE?

I do believe that the IEEE is quite active in India and elsewhere (at
least I know of a whole bunch of Indians, based in India, who have
@ieee.org addresses)

I don't imagine that the global IEEE membership really shares this
opinion, but well, not being an IEEE member at all I could well be wrong

Never mind me, I'm just a bit pedantic on the difference between the US
chapter (however large it may be) of a worldwide org, and the worldwide
org itself ...

        srs






-------- Original Message --------
Subject: IEEE-USA release not really protectionist
Date: Tue, 23 Mar 2004 17:30:44 -0800
From: Jeff Gruszynski <jgruszynski () mindspring com>
To: declan () well com

In the fine print of the new release it says "IEEE-USA", that is, the
USA chapter of the international organization.  I don't see how this is
"protectionist" simply because they take on a legitimately national
issue.  I'd expect the IEEE-UK or IEEE-China to do the same.

Pretty much all the IEEE-USA points are exactly correct, from a
national USA perspective.  Outsourcing *does* put at risk the US's
historic ability to lead most technology development and innovation.
It could come to pass that being an "Engineer" in the US may become as
rare as being a "Service Station Attendant" or a "Stenographer".  I'm
not saying that protectionism is even an option, but competitiveness is
certainly a requirement at the national level.  That means wanting to
have something that other countries don't have, which is
differentiation, not protectionism.

J Gruszynski





-------- Original Message --------
Subject: Re: [Politech] IEEE-USA has the right approach on offshoring 
REMOVEEMAIL
Date: Sat, 20 Mar 2004 03:39:09 +1100
From: Tony Healy <thealy () siliconchic com>
To: Declan McCullagh <declan () well com>

Hi Declan

Miguel Helft quotes a particular case in support of offshoring. Here are
some cases with different outcomes.

Santa Clara based Ishoni Networks, valued at $200 million and with $68
million from VC's, went broke after sending its development work to India.
[1] Quakertown, Pa based AM Communications entered an outsourcing deal with
an Indian firm and effectively lost its intellectual property, deterring
investors later on. [2]

Fitness chain Life Time Fitness found that a software project outsourced to
a supposed leader in India was delivered with screens not working and that
most of the outsourcer's developers had only a year or two's experience. [3]
Lehman Brothers and Dell have returned offshored services to America, and so
has retailer Coles Myer in Australia. [4][5][6]

Several offshoring spruikers have changed their tune after gaining real
world experience. They include Ravi Chiruvolu, a partner at Charter Venture
Capital, and Business Week marketing columnist Christopher Kenton, who were
both boosting offshoring in early 2003. By December 2003, Chirovulu was
explaining to a reporter that Indian middlemen gouge foreign corporations up
to 10 times the fees they charge local (Indian) companies. [1]

By January this year, Kenton was writing of unexpected hidden costs from not
having developers under the same roof. Kenton also warns of the difficulty
in protecting intellectual property and enforcing contracts. [7]


VC's are pushing it
-------------------

Matloff has previously commented on the surprising propensity for venture
capital firms to demand offshoring from investees. This was most striking in
the case of Google, which has world class R&D team in the US, and would not
seem to need any offshoring. Nevertheless, that's what they did as
preparation for their IPO. Almost all business plans nowadays include
offshoring, according to a VC executive quoted in the San Francisco
Chronicle. [8]

The company described in Migquel Helft's column, Tasman Networks, is in fact
a heavy VC play, backed by Mayfield, Bowman, Worldcom and others. [9]

In conclusion, offshoring covers several different issues including economic
externalities and is too complex an issue to leave to business management.


1. Matt Marshall: Offshore labor drove firm to brink, Mercury News, 08 Jan
2004
http://www.mercurynews.com/mld/mercurynews/business/7659988.htm

2. David Gumpert: Growing Concerns, Business Week, 03 Mar 2004
http://www.businessweek.com/smallbiz/content/mar2004/sb2004033_0420.htm

3. Wesley Bertch: How Offshore Outsourcing Failed Us, Network Computing, 16
Oct 2003
http://www.nwc.com/shared/article/printFullArticle.jhtml?articleID=15201900

4. Lehman Brothers stops outsourcing IT help desk from India, Hindustan
Times, 16 Dec 2003
http://www.hindustantimes.com/news/181_497389,0003.htm

5. Ed Frauenheim : Dell drops some tech calls to India, CNet, 24 Nov 2003
http://news.com.com/2100-7342-5110933.html?tag=nl

6. John G. Spooner: Growing pains hit Dell's customer service, CNet, 20 Feb
2004
http://news.com.com/2100-1042_3-5162141.html?tag=nefd_lede

7. Christopher Kenton: The Changing Face of Offshore Programming, Business
Week Magazine, 05 Jan 2004
http://www.businessweek.com/smallbiz/content/dec2003/sb20031231_3576.htm

8. John Shinal: VC firms push for outsourcing, San Francisco Chronicle, 07
Mar 2004
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/03/07/BUGGI5ENK31.DTL

9. Tasman Networks investors
http://www.tasmannetworks.com/aboutinvestors.html


Regards, Tony Healy
Australia







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