Really? Kids can offshore homework to Indian tutors? I suppose I should be surprised by this, documented here in this article in the online edition of Global Post. But I’m not. If something can be outsourced or offshored for less (and hopefully for better), it will be. So for $99 a month, American customers of such firms as TutorVista in Bangalore can get unlimited coaching in English, math or science from one of 1,500 tutors—some who work onsite at TutorVista and some who work from their own homes across India. Apparently, the tutors will help write term papers and S.A.T. essays, or even help finish homework. By the way, similar personalized services in the United States charge about $40 an hour, according to the article.
So as I said, if something can be done cheaper and better by someone other than you, it can outsourced. There’s money to be made! Which leads me to a more salient point. Money is being made in the outsourcing market, despite the doom-and-gloom economy that has curtailed companies’ IT budgets.
To wit, IBM just recently announced a seven-year deal worth about $82 million to provide outsourcing services for Samlink Ltd., a Finnish IT banking services provider. The deal calls for IBM to manage Samlink’s data infrastructure services, so that Samlink (imagine this) can focus on its core business of providing infrastructure technology banking services. IBM’s outsourcing business also got a boost when, just this week, the United Kingdom’s Driver and Vehicle Licensing Agency (DVLA) announced a three-year extension to an existing ten-year IT services agreement. IBM will continue to manage the DVLA’s IT infrastructure and its ongoing operation, maintenance and support, and will also continue work on a variety of systems integration projects.
Meanwhile, Philip Verges, the CEO and founder of NewMarket Technology said his firm has signed nearly $100 million worth of outsourcing contracts this year. NewMarket Technology is a systems integrator for emerging markets in Asia, South America, and Africa. Outsourcing has become a major focus for the firm, largely in an effort to drive up recurring revenue. In a Web cast this week on Wallstreetreporter.com, Verges said NewMarket Technology launched its outsourcing services because contracts from other services, such as systems integration, are shorter in length. Adding to the almost $70 million worth of outsourcing services contracts signed earlier this year, the company announced a three-year, $36 million deal to provide outsourcing services to Aoyuan Electronic Co. Ltd. in Dalian, China. The letter of intent was executed by NewMarket’s operating subsidiary in China and is the third major outsourcing contract signed this year, the company reports.
Obviously, IBM’s and NewMarket Technology’s new (and recurring) customers believe if something can be done better and more cheaply by someone else, than so be it. Of course, now I can hear the scores of American teens making the same argument about their homework. Hmmm.