Peter and Jim, thanks for those two very interesting stories. After reading them I posted elsewhere the following, which, with some late editing, works equally well here:
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"The World Is Also Circuitous"
My subject line above, of course, is a play on Thomas Friedman's now popular book title, The World is Flat.
The story below from TimesOnline highlights one of the less understood implications of "the transparency afforded by optical communications", indeed it brings into focus what will inevitably happen with over 300,000 km of subsea cable already sitting on ocean floors, and another twenty percent or more of that now slated to fill gaps of relatively new demand over the next two years in non-Atlantic regions. At some point we approach what Doc Searls once called the Giant Zero, i.e., where distances between any two points on the globe have been reduced, effectively, to zero. See: tinyurl.com .
"Indian wage spiral forces TCS outsource in Mexico"
Ashling O’Connor in Bombay, June 7, 2007
tinyurl.com
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Will it be long before outsourcing entities in India and China find themselves sourcing large amounts of office automation and software development work commissioned by customers in New York and London to locations near Tulsa, Oklahoma and Cork, Ireland next? One of the factors that the author doesn't quite capture, but should have, for its influence in the matter, is India's and China's electric power generation and delivery infrastructures, both of which are in high levels of distress and in dire need of new and _hopefully _ clean _ supply, which will take many years, if ever, to catch up to a commensurate (or by some greater multiplier) of constantly escalating demand levels.
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And later:
I should have noted above that Jim Kayne contributed this story this morning on SI in response to Peter Ecclesine's earlier post last nite:
The Real Cost Of Offshoring
BW:By Michael Mandel, June 18, 2007
businessweek.com
"U.S. data show that moving jobs overseas hasn't hurt the economy. Here's why those stats are wrong."
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Some parallels can be inferred rather quickly when viewing how the government reports GDP metrics and how HSIA uptake numbers are reported, IMO. Enjoy!
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NEW: Here's one of the sidebar stories from the TimesOnline piece, in the event anyone missed it:
Globalisation is no longer just a local phenomenon
James Harding, Business Editor
June 7, 2007
business.timesonline.co.uk
As the protesters took to the barricades at the G8 summit in northern Germany yesterday, Tata Consultancy Services struck a blow for globalisation.
India’s largest software services provider announced that it would hire 5,000 employees in Mexico over the next five years, as it grows increasingly concerned about skills shortages and labour costs at home. In part, the decision to start outsourcing jobs to Guadalajara is driven by TCS’s wish to be closer to the US market. In part, it reflects Tata’s calculation of how the Indian rupee will fare against the Mexican peso.
But Tata’s Mexican wave is also part of a fundamental change in the nature of globalisation. In a report released this week titled What Matters, McKinsey, the management consultancy, argues that we have entered the third phase of globalisation. In the first, multinational companies in the west raced to set up factories and offices in cheaper labour markets. In the second wave, those developing countries started to look not just like low-cost producers of western products, but rapidly growing markets for western goods. In the third phase, emerging market companies and countries are making the running.
Many of the new global corporate powerhouses come, of course, from Brazil, Russia, India and China. Before 2000 Indian companies had never made a substantial international acquisition. Last year Indian companies did more than 100. In 2000 the US accounted for nine out of every ten dollars raised by initial public offerings worldwide. Last year it was one in ten. The biggest IPOs were Russian and Chinese. And the trends continue: Tata bought Corus, the remnants of British Steel, earlier this year; Rusal, the Russian aluminium group, has this week launched the roadshow for its planned £15 billion float on the London Stock Exchange.
But the distribution and diversification of capitalist power around the world has not only moved beyond the West to the BRICs. It is rapidly moving all over the planet. If Vietnam was the economy to watch in 2006, it is Libya in 2007. Colony Capital, the US private equity group, yesterday bought into Tamoil, the Libyan-owned petrol retailing business for $4 billion.
Likewise, people are gasping at Dubai today as they did about Shanghai a decade ago: the gulf state, which is the world’s 224th largest city by population, has more construction cranes per capita than anywhere else. This is, as McKinsey puts it, “the globalisation of globalisation”. Or, if you like, the spread of globalisation and its contents.
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FAC
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