July 30, 2004

Outsourcing Once Again

Ah. Things become clear. The people whom I was negotiating with over the internet in order to get cheaper hotel rooms in Rome are based in... Bangkok. No wonder they can offer such good rates: the Italian hotels are crafting the rates they offer the brokers for Asian tourists, and the brokers' labor costs are very very low indeed.

I must admit that this is something I did not expect--not so soon.

Posted by DeLong at July 30, 2004 10:36 PM | TrackBack | | Other weblogs commenting on this post
Comments

The big, long, nasty URL in the Obama post really screwed up the formatting for Camino/Mozilla/Safari browsers, but it's good on IE, so who cares? As Meatloaf so wisely said "19 out of 20 ain't bad" (I paraphrase).

Posted by: JoJo on July 30, 2004 10:51 PM

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See, call centers are one thing, software project engineering another; but it takes booking a hotel room to make it real. :-)

Posted by: William in Shanghai on July 31, 2004 03:44 AM

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One of the major differences between this incident of outsourcing and all the rest is the cost of entry.


In all others, there was the capital cost of opening the factory and infrasturcture to get the raw materials.

In this one, there in only the cost of a room with desks and a connection to the Internet.

Posted by: James Goodfellow on July 31, 2004 07:21 AM

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Dude I hope you don't have a weight problem. Even if you do, enjoy the food & worry about it when you get home.
I am green with envy. Maybe I can steal a week from work in November. Alghero...yeah, it's time to finally visit Sardinia.

Posted by: jackNYC on July 31, 2004 08:23 AM

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"In this one, there in only the cost of a room with desks and a connection to the Internet."

And that setup will work for a multitude of businesses: hotel booking, customer service, software development, etc.

No need to retool the factory and bring in expensive new equipment in order to serve a new business.

Posted by: Jon H on July 31, 2004 10:32 AM

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Outsourcing hotel brokerages ain't nothing. I just read in todays La Repubblica
, that you can order a Kurbana (holy mass) recited in Malayam in St Joseph's church in Kerala for 50 Euros (sad to say $ 60 not $ 40 anymore see Brad's post above). Raimundo Bultrini implies that he is reporting from anthikad but I strongly suspect he got the story here http://www.dqindia.com/content/industrymarket/newsanalysis/2004/104052502.asp
or here
http://www.rediff.com/money/2004/apr/30spec.htm.

Now La Repubblica is much less reliable than Bob Woodward (see above) but it does seem possible to book masses in Kerala on the web (I couldn't find such an attractive price).
http://www.pavarattyshrine.com/Offerings/offering.htm

better links at my link beggin blog

Posted by: Robert Waldmann on July 31, 2004 12:15 PM

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The business savvy of the world cannot be assumed. My experience a few years back was with a monopoly of travel agencies in some of the heavily touristed areas of Bankok. All w/ different names, but owned by the same company . They would tell the young foreigners that all the flights on the major carriers were sold out, then sell them tickets on lesser known carriers- ever flown on Biman? Anyway. The tickets would be readily available outside of these areas.

So now, if I understand; given the tiered pricing of European travel companies, it's ticket arbitrage via the Internet? Not surprising.

The hotel industry obviously isn't as vigilant as the pharmaceutical industry.

Posted by: jen on July 31, 2004 12:40 PM

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Of course the people whose jobs have been outsourced won't be looking for hotel rooms in Rome any time soon...

Posted by: Dubblblind on July 31, 2004 06:46 PM

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Give outsourcing one more Bush administration, and you'll be reading this post on IE Broadband in LONGHORN OS as a pay-per-view, with all your files resident in NEXT on some terato-drive in Jalalabad, this pesky MS Window pop-over, "Where would you like to (pay-per-view) go to today?" everytime you want to save or read those files.

Technological economics is moving so fast today, our elected representatives have no more useful function than politely praising each other for a 3-year delayed 911 Commission Report that will just as politely be swept under the white rug, and then used to craft another huge bureaucracy.

By the time we reach 2008, US history will have been completely rewritten, your choice in the election booth will be between the Red Army and the White Army, we will be perpetually at war, we will be perpetually potato-eaters, and global corporate elites with their political enablers will chit-chat on C-SPAN about how unnecessary all those political regulations were in a world now ruled by "Free Trade" and "Free Labor".

Which is their ultimate goal. Reducing humans to a pair of free highly-skilled and robotic hands. Yeah, "free" alright. Arbeit Macht Frei.

Posted by: aaron haffen on August 1, 2004 12:57 PM

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Off shoring:

A way for the important people to relieve the little people of their jobs and lives.

The first era of globalization cooked along, with rich people deciding they didn't need the rest of us, until it was necessary to have people who would die en mass for an abstract notion of "patriotism". It took a while, but the elites - whether capitalist or communist or fascist - saw that canon fodder needs to be better cared for if it is to be useful.

We've forgotten this lesson, which, of course, means we are bound to repeat it at some point in the intermediate term future. Try when global oil demand outstrips global oil supply. That did the trick in the 1930's.

Don't get me wrong: free trade is a moral necessity, as well as a political and economic one. However, when the big winners are those that own large chunks of multi-national corporations - while the losers are the people who have to fight and die to protect the legal systems that those corporations rest upon, it is plain that the present implementation is not stable. Also not stable is having a vast super-underclass of people in undeveloped nations.

Or do people think that it is coincidence that the rich nations are suddenly much more interested in removing agricultural subsidies to very poor nations now that assymetrical threats can hit elites in New York City?

Posted by: Stirling Newberry on August 2, 2004 09:13 PM

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