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Outsourcing Toolkit

Is America's IT dominance under threat?

Ed Frauenheim CNET News.com

Published: 20 Apr 2005 15:15 BST

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And this gets down into the colleges?
Yeah. I graduated from a big public university and I've spent my life in a big public university. I believe in the big public universities. And part of the big public universities' model is you are able to attract pretty successful faculty, pretty successful people who could be doing a lot of things in part because there's this research side of it as well. So if these faculty are pushing the state of that research, those ideas get into classrooms. And those ideas improve the content of these courses.

So, If I'm getting you right, you're looking at this contest result as possibly a reflection of this symptom of flat or declining funding of research, and that may be not energizing the curriculum or energising the schools.
Yeah. That kind of goes together. The computing industry is doing less research than they used to. I think over my career what's happened is the computing industry has really driven performance up and prices down. It squeezed the margins out of almost everything... It's amazing what we're doing. But we've concentrated so much in removing margin out of everything that there's not the money around that there used to be to be able to do the research — that funded the Bell Labs and the Xerox PARCs in the past.

And then with cutting back on research funding from the government — if both those things are cut back, there's not as many vehicles for pushing the IT research as there was 20 and 30 years ago. I think (the US schools' contest showing) fits in that context.

Do you think that, partly as a result of (the research funding situation), the field isn't attracting the best and brightest? Or as many of the best and brightest as it did?
In the last couple of years, the echoes of the dot-com bust and then this outsourcing stuff has really affected [school leavers'] decisions. ACM is working on a study of outsourcing. I don't think the reality is as bad as people imagine. People think, 'Look at our wage scale; look at the weight scales of some of these other countries — it's impossible for the US to compete.' I don't think it's true. I think the reality won't be as dire as people are deciding on their own. But right now in the United States it's affecting what people are choosing to major in.

For me at the very height [of the Internet boom], it wasn't such a wonderful thing. We had people taking computer science courses, and they didn't like computer science... There were people who were just doing it for the money. I was just happy for those people to major in something else — become pre-meds or whatever they do.

So some downsizing is fine. But I'm worried right now whether it's actually worse than that, that people are thinking IT — because of their fears of the outsourcing — won't be a factor. And to me it's, 'Boy, we're only 50 years into this field, and the opportunities in this century are just astounding: all the things we didn't do right plus all the new opportunities. It's going to be an exciting field.'

Bill Gates gives a talk like that. I don't know how often I agree with Bill Gates, but I absolutely I appreciate him doing that.

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Software development for instance can be off shored with a perceived reduction in development costs but the resulting code is rarely of good quality and there is much greater expense in reworking and support over the life of software developed in this way. As a consultant who has to deal with off shoring on daily basis I very often see no savings at all over the lifetime of a software product, and in some cases actually see projects costing a fortune to rework.

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