How to Compete with India: Work for Free
Friday, February 27, 2004
Going forward, it’s obvious that a big chunk of software development will be done in lower-cost places than the U.S. and Western Europe. India gets the most attention, and for good reason: it’s developing into not just the cheapest but also perhaps the best place in the world to create many kinds of software. My visits to Bombay and Bangalore have left me convinced that India’s real advantage isn’t just lower costs—it’s also the tremendous enthusiasm of its people. As I’ve argued before
, nothing other than cricket seems to create as much excitement in India as software.
So how do we compete? Who in the high-cost Western world has both the enthusiasm and the willingness to work cheap? The answer is obvious: open source developers. Unlike commercial developers who want to retain some part of the economic value they create, a large percentage of open source developers work for no pay. How much more enthusiastic can you get?
The value these developers create still goes somewhere, of course, and it’s not hard to figure out where
. Maybe we’ll one day look back on the open source movement as a youthful indiscretion, an exploitation of hacker enthusiasm that eventually withered on the vine as its participants realized how much their work was enriching wealthy corporations. Yet by choosing to let somebody else reap the benefits of their labor, open source developers today can undercut the costs of anybody, anywhere. How do you compete with free?
Given this, open source offers one way to keep a slice of software development at home. How else can expensive Westerners compete with talented, hard-working Indians who make a quarter of our salaries? It’s a Pyrrhic victory, of course, since this approach leaves today’s developers even worse off economically than they already are. While open source developers certainly can experience the joys of the fine artist (as my friend Richard Monson-Haefel describes so well
), they also run the risk of experiencing other traditional aspects of the artistic life, such as living in garrets and not having enough to eat.
Who knows? Maybe open source fever will become a major force in India too, moving the center of gravity for this world away from the U.S. and Europe. At the moment, though, it appears that most Indians are too pragmatic to give away their work for free. Growing up rich in the Western world makes it easy to take for granted what you have. Working your way into the middle class and beyond, as typical Indian software developers are doing, gives you a much better appreciation for the value of your effort. My guess is that for this group, getting paid for what you create is likely to remain a more appealing prospect. While I'm sure Indian developers are happy that their labor costs are relatively low, I can't believe they're in a hurry to see those costs go to zero.