Outsourcing to IndiaFriday, May 20, 2005
The technology lead prized by the US, Europe and Japan could come back to haunt the regions as nations such as India and China progress without the shackles of old fashioned hardware and software, according to Sun Microsystems President Jonathan Schwartz.
“My view is that (India and China) don’t have to deal with all the legacy systems that Western Europe, the US and Japan do,” Schwartz said in an interview with The Register. “There are no mainframes. Microsoft Exchange doesn’t have the same presence in the IT landscape. Windows isn’t nearly no entrenched.”
Developed nations must spend an excessive amount of time focused on reworking old systems to work on modern computing tasks. In addition, customers are hampered by a lack of innovation – the result of bloated, lethargic companies that own huge markets such as the mainframe, desktop or browser, Schwartz said.
As a result, India and China could well dominate something Schwartz sees as the next-wave of computing, which is a scenario that takes millions of networked devices, high bandwidth and web services for granted. While the US is busy paying cheap coders to fix PeopleSoft applications, savvy folks in India could be plowing ahead on a fresh infrastructure.
Schwartz admits that this forecast may well be thwarted by innovation here and in other established IT regions. Still, Sun Microsystems has decided to up its presence in India and China to make sure it understands the business and technology climates in these burgeoning markets.
“You can’t huddle in Mountain View and expect to be able to understand the market in China,” Schwartz said. “You have to be there.”
Sun employes between 6,000 and 7,000 software developers in 28 countries. It has just under 1,000 of these staffers in Bangalore and about 500 in Beijing.
Like many major IT vendors, Sun has faced a backlash for its use of offshore software labor.
“One moment, we are subject to a reduction in force (RIF) in order to cut costs, and before that exercise is even complete, Sun are saying that they need more people in China,” a former Sun employee wrote to The Register, adding that he found such actions “insulting.”
Sun has gotten off lighter than companies such as HP and IBM in the pubic offshoring/outsourcing debate. This, however, could change as the onetime high-flyer struggles to keep staffers happy and, er, employed. Schwartz, however, isn’t apologetic about Sun’s decisions.
“We have been doing this for 200 years,” he said. “We go around the world and try to identify pools of talent. You have to ask yourself if you’re a global company then what is offshore.
“I am just as worried about the morale of my employees in Beijing or Bangalore as I am about the ones in Mountain View. The luddite view is that they are just a great source of cheap labor. This is about creating services and businesses in those economies.”
An effective partnership Sun has already managed to form in China comes via its relationship with networking firm Huawei. Sun has found that the margins on some of the networking gear are much higher than low-end servers. And, in fact, Sun is hiring more support staff in China just to manage its Huawei sales.
Where the rest of us dream of sugarplum fairies, Schwartz tends to get lost in visions of device-rich networks and dancing web services. It’s a sickness that consumes many Sun executives as they try to own a chunk of the next big computing buy. It’s this mentality that makes Sun staffers talk in such flowery language about a “networked India” or “web service-centric China.”
Will the next Google or Napster or Salesforce.com come out of Beijing while US staffers are busy installing the latest Windows Service Pack? Probably not in the near future. But we’ll chat again in ten years.