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To: Lizzie Tudor who wrote (176963)	2/9/2004 10:16:40 AM
From: Amy J	Read Replies (3) \| Respond to of 186894

Lizzie, RE: "Microsoft does a huge amount of work offshore AmyJ, it doesn't matter if the VP is sitting in redmond, the issue is where is the core technology happening" A person obviously can't get into specifics of how many thousands of developers are in each of the product groups in Redmond. You are completely wrong, when you imply all the core technology work is done overseas. RE: "Microsoft is running silicon valley job fairs to staff up levels in Bangalore, they advertise on the radio." India has a HUGE market. As large as the USA. RE: " But anyway who cares?" The discussion of offshoring has value - the government should get a handle on what's going where and why, in order to decide if they want to keep certain things here thru a software or manufacturing credit. RE: "The point, which is hard to deny since executives have made my case for me, is that software leadership is transitioning to Bangalore. Are you denying that to be the case?" Gates still lives in the same house he built sometime around 1990, thousands of Windows and all. Don't confuse Oracle's bankers with the rest of the software development world. The database industry is a mature market and fits perfectly with India's more math-oriented school system. Certain other aspects of software are also getting a bit mature. RE: "I personally think the only reason this is happening is due to cost." A software credit would reduce cost. RE: "We have plenty of talent here, but what we don't have is an army of cheap coders." If our schools were revamped, we'd have more innovative new software technologies come out, which could mean higher margins and higher wages. Or, maybe in the shape and form of new services. RE: "The US will never be the cheapest code producer." Which is precisely why innovation is key to higher wages. When something gets mature, you either innovate or change your business model to something else. RE: "The reason open source mitigates this threat is that open source and specifically the GPL push the value add in software back to services and support (similar to the old IBM model from the 80s), as opposed to a business model where whoever produces the most proprietary lines of code for the cheapest wins." Since you believe open source puts the value back to services and if you feel the USA will own these services, then why are you concerned? Your idea sounds like a good idea. Puts the USA into the drivers seat by changing the business model from software to higher margin services - assuming services yield higher margins. CIOs like to pay for services more than products. VCs tried this with some ASPs investments, they had some setbacks which I think are temporary given CIOs preference for services over products. Redmond already has service offerings. RE: "It is entirely possible that a US company can make a business out of open source DBMS that is competitive with Oracle's offshore R&D facility for example." Sounds like a good idea though don't know the dbase industry - I'm curious, why don't you do it? Given your belief that USA services will replace the software industry to your benefit, what's your concern? Regards, Amy J