The ‘offshoring’ debate…

The ‘offshoring’ debate…

… is really hotting up in the US, as skilled workers (e.g. programmers) who once thought themselves indispensable are now discovering that that their employers have discovered real (and cheaper) alternatives overseas. I’ve come across an interesting post from John Robb’s weblog on the scope of the problem:

“Here isan article in the McKinsey Quarterly (via Forbes):  By McKinsey estimates, in 2002 it was worth $32 billion to $35 billion–just 1% of the $3 trillion worth of business functions that could be performed remotely. Because of the significant benefits already being realized through offshoring, the market is projected to grow by 30% to 40% percent annually over the next five years. This prospect may cause consternation over job losses in the United States but it will make offshoring an industry with well over $100 billion in annual revenue by 2008. 

What is $100 b of offshored services worth in terms of jobs?  First, an offshored service costs ~50% of the service produced in the US (on average).  Since this is basically a pure salary play (infrastructure is minimal), these estimates mean that 2 m ($100k) information workers will be offshored by 2008.  Also, given these jobs usually produce upwards of ~4 additional jobs per position (community impact), this is a net loss of 10 m jobs by 2008.”

More Hutton fallout

More Hutton fallout

Two interesting articles today. A terrific polemic by Max Hastings, former editor of the Daily Telegraph and the Evening Standard, and not one of nature’s left-wingers. Here’s part of what he has to say:

The longer I think about Hutton, the angrier I get. It is hard to dissent from his conclusions about the BBC’s failures. Yet the damage done by his grotesquely lopsided report vastly outweighs the gravity of the offence. The corporation, guilty of lapses of journalistic judgment, has been treated as if its reporter had committed perjury in a court of law. Lord Hutton seems to expect from working journalists the standards of proof he would demand from witnesses on oath.

Lord Hutton seems unable to grasp a simple truth: all journalism is conducted against a background of official obfuscation and deceit, which does much to explain our blunders and omissions. It seems remarkable not how much journalists get wrong – a great deal – but that we are able to retrieve from the Whitehall swamp fragments of truth, and to present the waterlogged and bedraggled exhibits to readers and listeners.

I say this with regret. I am more instinctively supportive of institutions, less iconoclastic, than most of the people who write for the Guardian, never mind read it. I am a small “c” conservative, who started out as a newspaper editor 18 years ago much influenced by a remark Robin Day once made to me: “Even when I am giving politicians a hard time on camera,” he said, “I try to remember that they are trying to do something very difficult – govern the country.”

Yet over the years that followed, I came to believe that for working journalists the late Nicholas Tomalin’s words, offered before I took off for Vietnam for the first time back in 1970, are more relevant: “they lie”, he said. “Never forget that they lie, they lie, they lie.”

The strangest thing about Hutton’s mindset, as Max observes, is his quaint idea of how political journalism is conducted in the UK. His model seems to be this: the journalist asks the government spokesman a question; the spokesman answers; the journalist writes down the answer; and the newspaper prints it. The idea that an official source might not be truthful never crosses old Hutton’s mind. Hastings goes on to cite two cases where prominent (named) New Labour politicians told him outright lies. And, in another interesting article, lawyer Anthony Lester ponders the implications of Hutton’s proposed code of conduct for the media. Quote:

“The report found David Kelly guilty of acting in breach of the civil service code in talking to Gilligan without authority. It did not consider whether Kelly might have had a public interest Spycatcher defence as a whistleblower. Hutton stated, as a general principle, that ‘accusations of fact impugning the integrity of others, including politicians, should not be made by the media’, without referring to the dangers inherent in self-censorship and prior restraint, or to the constitutional right to free speech now protected by the Human Rights Act against unnecessary interference or restriction – especially on matters of political expression. The report does not consider (as a libel jury would have done) whether, despite sloppy journalism, weak editorial supervision and poor management, it was still in the public interest for the BBC to broadcast the fact that a senior and well-informed public officer had made serious accusations about the way in which the dossier had been compiled.

Those newspapers that have gleefully attacked the BBC should consider the dangers to them and their readers of acquiescing in this approach. As for the BBC, we must hope that its new chairman and director general will be chosen without government influence, that the systemic failures will be corrected but not over-corrected, and that the public’s right to know will not be chilled by self-censorship or government interference as a result of the extraordinary and costly procedure that the government invented to vindicate its reputation.”

Ryanair loses it

Ryanair loses it

It’s not often that one can spot the exact moment when a company blows it, but this week we saw it with Ryanair, the Irish budget airline that has hitherto been the apple of every traveller’s eye. It’s just lost a case brought against it by a disabled traveller who was charged an extortionate fee for the use of a wheelchair. According to the BBC report, “Bob Ross said it was discriminatory to be charged an £18 fee because he was unable to walk to the check-in desk. [Mr Ross has had cerebral palsy since birth and later developed arthritis, so walking is very painful.]

Judge Crawford Lindsay QC ruled Ryanair acted unlawfully by not ensuring a free wheelchair was provided.

The community worker was awarded £1,336 in compensation.”

And guess what Ryanair does next? Claps a 50p levy on every passenger from now on. This will yield about £12 million a year — enough to buy 24,000 wheelchairs by my calculations. It’s a spiteful, vindictive response which will damage the passenger-friendly image of the airline and cost far more in public relations terms than any money it will bring in. Ryanair’s bosses are clearly getting rattled — they had to issue their first profits warning this week after years of spectacular growth. And shares dropped 30% in a week.

A new kind of email server — the 50cc Honda motorcycle

A new kind of email server — the 50cc Honda motorcycle

Fascinating article in the NYT and IHT about an ingenious way of getting email to and from places with no internet connections. Extract:

“Without wires for electricity or telephones, O Siengle, a village of about 800 people, has nevertheless joined the online world, taking part in a development project set up by an American benefactor to connect 13 rural schools to the Internet.

Since the system went into place in September at the new elementary school here in Cambodia’s remote northeast corner, solar panels have been powering three computers.

Once a day, an Internet “Motoman” rides a red motorcycle slowly past the school. On the passenger seat is a gray metal box with a short fat antenna. The box holds a wireless Wi-Fi chip set that allows the exchange of e-mail between the box and computers. Briefly, this schoolyard of tree stumps and a hand-cranked water well becomes an Internet hot spot.

It is a digital pony express: Five Motomen ride their routes five days a week, downloading and uploading e-mail. The system, developed by First Mile Solutions, based in Boston, uses a receiver box powered by the motorcycle’s battery. The driver need only roll slowly past the school to download all the village’s outgoing e-mail and deliver incoming e-mail. Newly collected information is stored for the day in a computer strapped to the back of the motorcycle. At dusk, the motorcycles converge on the provincial capital, Ban Lung, where an advanced school is equipped with a satellite dish, allowing a bulk e-mail exchange with the outside world…”