That's interesting about Dell. I'm currently working a contract for a major multinational company. Helping them shut down the IT, customer service, and admin departments of a recent acquisition. About 400 people will be out of work soon. All IT except Level 1 and 2 support is going to India. Customer service is consolidating in the US.
Omcate, thanks very much! I have bought a few options on QQQ but it was never clear to me which price etc I should be choosing even when I knew the direction I thought the market would go in. All very complex. Do you have special software to see the whole picture. So I basically stick with futures and equities. Which broker do you use?
"Six months ago, I could find high-level programmers in India willing work for $15 an hour, vs. the $100-plus an hour I was paying Americans for the same work. In only six months, that rate has climbed to $25 an hour in India, while my domestic rates have dropped to around $35-$50." it jive with my personal experiences that Indian programmer won't settle to for less than American counterpart.
Good.... the best thing american programmers can do is circulate propaganda in india along the lines of: "American programmers say you are INFERIOR to them, and this is why you take a lower rate like a cheap WHORE no one wants!" Then they will raise their rates to match ours, and life will be better Sound like a plan??? peace axeman
India is being replaced by China as the low cost supplier. So, India will probably soon have problems related to losing business to China - well, they already do have this problem. The primary issue connected with the continuing loss of margins in the software business revolves around the lack of proprietary knowledge. There is very little new proprietary knowledge that form the foundation of a barrier to competition. What we have found is that the only model that makes sense going forward is to have a truly vaulable propietary algorithm / technique, and making it only available to customers through our systems. That is the customer comes to us for the service and no software is installed on the customers systems. In this way we kill several birds - so to speak - with one stone. Piracy becomes effectively zero, we retain trade secret control over our invention, and thus customers have few alternative choices and as long as we keep our pricing reasonable and dont treat our customers poorly our business is somewhat protected against foriegn competition. Like I said in many previous posting, commodity skill sets and services in the software business are a recipe for BK/liquidation and only those that have something truly valuable will prosper going forward - like any other business......
7:27AM Software buyers have more power -- WSJ : The Wall St Journal reports that software buyers have more power than ever before -- and they're using it to force software makers to change the way they do business. Some customers are refusing to upgrade and are demanding their suppliers continue to support old software. Others are dumping their suppliers and shopping for more-accommodating vendors. Still others are training their own employees to handle tech support. For example, after months of negotiations with Fluor, SAP, which was receiving a chorus of complaints from other big customers about the upgrade, blinked. Shortly after, SAP announced an offer for all its customers: Those who don't upgrade can receive a lower-level maintenance option for no extra charge. In 2002, a customer revolt forced Microsoft Corp. to overhaul its plans for sweeping changes in how it charges for upgrades. PeopleSoft Inc. this spring extended support for an old version of its software by an additional nine months. The widespread retreat signals that software companies may no longer be able to count on boosting the revenue streams that helped them through the technology downturn. Another example had a customer drop Siebel and switch to Salesforce.com, that runs software systems on its own computers, freeing customers from upgrade worries.
The jig is up. Our post WWII monopoly on capitalism is over. We've been running on fumes for the last 30 years. It looks prosperous on the outside, but on the inside, it looks ugly. 50 years ago, no one had to work 2-3 jobs to make ends meet. During the 50's and 60's, real wages were going up, our standard of living was rising and everyone was gaining. Of course, it also helped that we didn't have any competition then. Europe and Japan and had just gotten wiped out. China wasn't a factor. We had the playground all to ourselves. Fastforward to the 70's, and 80's and things start to change. Japan catches up and surpasses us in many important areas. China is waking up. Now in 2003, the toddlers (China and India) want to grow up and play with the big kids. China saves, invests and works their butts off to achieve our lifestyle. Meanwhile, we're spending like there's no tomorrow, borrowing like it's an entitlement and working harder but achieving less. Credit is the only thing propping up the economy. Without, we couldn't afford our SUV's and palm pilots. In 10-15 years, a good portion of the middle class will fall into the lowerclass. You could argue that America always adapts and changes and that we'll find new jobs to replace the old. But we're never had such high global competition before and our finances have never been so out of whack. How can we invest in new technology when we don't save money?
Not a big yawn if it is your job. And the impacts will be felt down the road. US is going to have a hell of a time competing. m