Since I wrote on remoteness a few days ago, new articles and blogs keep popping up.
Chad Dickerson has just linked the moving of IT offshore with open source, in the August 4 issue of Infoworld. To hear him tell it, a pro-open-source IT fellow was bemoaning the move of IT jobs offshore, and wondered at where he could find a competitive US-staffed supplier.
This ties into Alan Williamson's well-read blog on the economics of open source, and the thread over at Simon Phipps' blog.
Chad ends up wondering to what extent IT's pursuit of overhead in decisions to use open source (eg. Linux) instead of a commercial server operating system is driving all the margin out of software, and driving our suppliers (or their employees) offshore.
"IT managers make these kinds of decisions every day to save money, but it’s the same basic line of reasoning that drives American IT jobs offshore. The cost of running a business should be as low as possible, and any reduction in IT costs (including labor) helps the bottom line."Difficult questions. Open source solves some problems really well (read: development process), but in relying on open source for deployments do we run the risk of becoming {fishery,steel,...} workers?
And eventually, per the Dilbert cartoon, there is no place 'offshore' enough. I mean, what happens when you keep squeezing margin out? Where does the continuous search for cheaper cost structure drive you?
1. a reader left... Well, the flaw in the logic is: Why should IT companies not move offshore? If no open source competitors exist, they can reduce their costs anyway and become more competitve against their commercial non-OS competitors. Either way IT jobs are moved offshore.
Stephan Schmidt
Tuesday, 5 August 2003 6:26 am
Stephan Schmidt
2. a reader left... The majority of IT staff do not do software product development. Therefore, the deflationary effects of open source do not affect them. For the minority of software developers working in the software industry, its added pressure however the benefits of reuse allow for higher level of products to be develop faster.
Furthermore, software development is not analagous to marketing. Microsoft w/c makes over 32B a year only hires 50,000 employees worldwide. That's a drop in the bucket in the overall picture of employment.
At best Open source destroys markets, but in now way does it push a move to go offshore. If you don't have a market, doesn't matter how low cost your labor is.
Carlos E. Perez
Tuesday, 5 August 2003 8:34 am
Furthermore, software development is not analagous to marketing. Microsoft w/c makes over 32B a year only hires 50,000 employees worldwide. That's a drop in the bucket in the overall picture of employment.
At best Open source destroys markets, but in now way does it push a move to go offshore. If you don't have a market, doesn't matter how low cost your labor is.
Carlos E. Perez
3. a reader left... Sorry about the typos... should have read:
The majority of IT staff do not do software product development. Therefore, the deflationary effects of open source do not affect them. For the minority of software developers working in the software industry, its added pressure however the benefits of reuse allow for higher level of products to be develop faster.
Furthermore, software development is not analagous to MANUFACTURING. Microsoft w/c makes over 32B a year only hires 50,000 employees worldwide. That's a drop in the bucket in the overall picture of employment.
At best Open source destroys markets, but in NO way does it push a move to go offshore. If you don't have a market, doesn't matter how low cost your labor is.
Carlos
Tuesday, 5 August 2003 8:38 am
The majority of IT staff do not do software product development. Therefore, the deflationary effects of open source do not affect them. For the minority of software developers working in the software industry, its added pressure however the benefits of reuse allow for higher level of products to be develop faster.
Furthermore, software development is not analagous to MANUFACTURING. Microsoft w/c makes over 32B a year only hires 50,000 employees worldwide. That's a drop in the bucket in the overall picture of employment.
At best Open source destroys markets, but in NO way does it push a move to go offshore. If you don't have a market, doesn't matter how low cost your labor is.
Carlos
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