News Blog

Universities--they are one of America's growing exports.

The University of California at Berkeley is signing a deal with the government of Saudi Arabia to help the country build an engineering graduate school there, according to the San Francisco Chronicle.

Under the alliance, the mechanical engineering department at Berkeley will collaborate on research and help recruit faculty for a graduate department that will be part of the King Abdullah University of Science and Technology (mascot unknown). The graduate department will accept male and female students and open in 2009.

In turn, Berkeley will receive millions, according to the Chronicle. It is "a substantial amount," Al Pisano, chairman of the mechanical engineering department, told the paper.

If you're shocked and upset that U.S. universities are taking their expertise overseas in exchange for money, you're simply behind the times. For the past few years, top-tier schools have been setting up satellite campuses in their own name or helping regional governments create their own graduate schools with American expertise.

In the fossil fuel-rich state of Qatar, for instance, Cornell has established a medical school, which is connected to a hospital that has an $8 billion endowment from the royal family. Elsewhere in Qatar's education city you can find branches of Texas A&M University, Georgetown, and Carnegie Mellon University. The administrators at these schools point out that the curriculum, grading standards, and faculty (who agree to come to the Qatar campuses for two- and three-year stretches) are equivalent to what they offer in the West.

In Singapore, Singapore National University last year opened the first U.S.-style medical school with the assistance of Duke University. Graduates get a Duke-NUS degree. The school is part of a multimillion-dollar complex called Biopolis that has become home to several pharmaceutical companies as well as several U.S. academics who now split their time between labs in Singapore and the U.S.

And then there is the Masdar Institute, a graduate school in alternative energy being created in Abu Dhabi with the help of MIT. It opens in 2009. MIT also has a research center in Singapore. And NYU is building a school in Abu Dhabi that will have a student body of 2,000. Fancy that.

The motives for these deals vary, but here's a general summary: U.S. universities are strapped for funds, and foreign governments are offering up wads of it. Foreign governments also want to build up their technology industries. Because universities are the key to this, they are raiding ours, particularly the well-known ones with success in commercializing patents and ideas. Both foreign officials and university administrators in the U.S. have said that the U.S. visa system has made it more difficult for foreign students to get into the U.S. or stay here once they get their degrees. Since they can't come to the schools, the schools are going to them.

Many of these governments, particularly in the Middle East, also want to eliminate the luxurious form of semi-employment that the last few generations of kids have enjoyed. In countries like Dubai, many people didn't really need to go to college after high school to get a high-paying job. You could get one in the government. Multinational corporations have hired locals, but often to placate local leaders.

By sending more kids to college, Middle Eastern nations believe they can become less dependent on foreign expertise and achieve a society that more closely resembles others in the world.

It's good for women, too. The driving force behind Qatar's education push is Sheikha Mozah Bint Nasser Al-Missned, the wife of the ruler. Going to college allows a woman to increase her bargaining position in arranged marriages.

So, you see, there is some upside to our downfall.

I was working on this when I read this CNET News.com post. Apparently, Bill Gates believes that a strong technology sector will help keep America's economy healthy. I couldn't agree more. But I have a somewhat different take on the role tech has played in the U.S. economy.

Over the past few decades, the U.S. technology industry has had a number of "the sky is falling" moments, and every time we've managed to work through it and come out stronger than before.

For example, when I entered the job market in 1980, my employer--Texas Instruments--was the world's leading semiconductor maker. But in 1986, NEC and Fujitsu took the top two spots. By 1998, Japanese companies held the top 3 and 6 of the top 9 positions and TI had slipped to No. 5. Intel was the only bright spot, climbing the charts from 10th to 7th place.

Fast forward to 2006, when U.S. companies occupied 4 of the top 10 positions, including No. 1 (Intel) and No. 3 (TI). Rounding out the top 10 were two companies each from Japan, Korea, and Europe. That's certainly more balanced. What changed?

Well, U.S. technology companies and their employees seem to have a knack for innovating. But we don't just invent technology; we also create and dominate markets. We don't just rise to the occasion when our economy is threatened; technology innovation and marketing seem to be innate strengths of our culture.

For example, Intel, Microsoft, and IBM together created the personal computer. Contributions from Apple, Compaq, Dell, Hewlett-Packard, and others helped to make personal computing the most important product category in tech history.

Nokia may be the dominant cell phone company, but U.S. companies like TI dominate the chips inside, and Qualcomm invented CDMA--the competitor of Europe's GSM standard.

U.S. companies invented and dominate networking and the Internet. American companies invented the Palm Pilot, Tivo, and of course the iPod and iPhone. Except for Vizio, we don't make TVs, but TI invented DLP technology--the core of a new generation of HDTVs and video projectors.

It's surprising that we occasionally manage to out-innovate and out-market Asian and European consumer electronics giants like Sony, Samsung, Panasonic, and Philips.

First manufacturing moved offshore, followed by outsourcing of data and call-centers and even software and hardware development. But our unemployment rate has averaged just below 5 percent for the past 10 years, and it's not expected to change anytime soon.

When we're confronted with a challenge, we retool, innovate, create, and market. As an industry and with the occasional help of the government we also protect our intellectual property rights--one of the biggest challenges we've faced, and continue to face, since the early '80s.

At the end of the day, it's imperative that we continue to develop, nurture, and protect our human capital, our intellectual capital, and our venture capital. And not just in traditional electronics, but in biotech, nanotech, green tech, and energy tech.

Just as they say in the stock market, past performance is not a guarantee of future results. Technology is a treadmill that never stops or even slows; we can't either.

Note: a prior version listed Blackberry as an American invention. Research In Motion is a Canadian company. Thanks to Neal and sorry to all you Canadians out there.

I used to think customer service and technical support were givens: you either did it well or failed in business. After all, if you don't support your customers, what have you got?

Now I'm not so sure. The multiyear trend of outsourcing service calls--primarily to India--seems to have consumers endlessly frustrated. The big question is: does it matter?

Conventional wisdom says we're frustrated because American jobs are being outsourced. But anecdotal evidence from my own personal focus group suggests that we may have gotten over the outsourcing thing, only to hit a snag on the support itself not being up to snuff. ... Read more

Like me, there are a lot of people who fantasize about making extra money in their spare time. We've all seen the "earn cash while you work from home" flyers taped to the street posts but there's always a hitch, like the need to pay $500 up front to get the materials to start working.

So, when I heard about Amazon's Mechanical Turk business opportunity, my interest was piqued. It's one of Amazon's Web Services in which it offers things like infrastructure, computing power and storage on an outsource basis to start-ups. With Mechanical Turk, companies that have small computer-based tasks can get quick access to a large labor pool.

The service is named after an 18th century mechanical chess-playing device housed in a wooden mannequin decked out in Turkish garb, built by a Hungarian nobleman. Naive spectators were told that the machine made decisions using artificial intelligence, when in actuality a chess master hidden inside actually did the thinking.

At Amazon, anyone with a computer and Internet access can serve as the human intelligence behind all sorts of tasks that computers can't perform on their own. The Web site promises a way to make easy money: "Complete simple tasks that people do better than computers. And, get paid for it--Choose from thousands of tasks, control when you work, and decide how much you earn."

I liked the sound of that, so I decided to try it out.

I dove right in with an assignment that requires you to look at photographs taken of roadways and identify lamp posts and drains on the side of the road. Easy enough, I thought, but I guess I didn't read the instructions very carefully and found myself clicking away for naught. I realized my mistake--you have to click on each of the photos in sequence before tagging the items--and I was on my way. Basically, I was looking at rain-drenched highways that looked like they were taken in England. I had to click on the drains, some of which were difficult to see when obscured by puddles, and draw lines on the lamp posts. Once I got going I was pleased with my fast-paced clip, but realized that anyone with repetitive stress injury in their wrists could never do this task, as it entails a lot of mouse work.

I also learned that doing "work from home" projects at the office is not such a good idea. I kept getting distracted by work, e-mails and instant messages that required my attention given that I was still on the clock, and by well-meaning co-workers, offering me gum and wanting to chit chat. "Please don't disturb me, I'm earning money in my spare time," I told them with a chuckle.

After about 10 minutes of tagging roadway items, I realized that I had earned possibly 6 cents. For some reason, probably due to my own fault, the system only recorded one of my tasks. Then the company has to first review the work and accept it before any money is actually earned. Groan. I lowered my expectations a bit and moved on.

I decided to raise the bar and try a task that was worth more money, 10 cents. The task was classifying Web sites, something that sounded sexier than tagging lamp posts, and which seemed more suitable to my experience. I was given a set of Web pages and for each I had to assign a category to it, such as "entertainment" or "politics," flag it if it was sexually explicit, had broken links or no content, and specify whether it would appeal more to men or women and of what age range.

The first Web page was a blog written by a young mother. I tagged it "personal" in nature, aimed at women and targeting people 25 to 44. Easy enough. The second site required registration. There was no instruction for that so I moved on to another set of pages. The next Web page offered another personal blog that was just a list of musical artists and songs, all starting with the letter "A"--"Alice in Chains," "Aerosmith" and "Christina Aguilera." Easy--teen girls. The next Web site was mostly in Asian characters and had images of a model, food (what looked like pasta in tomato sauce with chopsticks), an interesting candid shot of people at a table, and photos looking through a kaleidoscope. Very artistic. Another blog was written by what appeared to be an exchange student from Hong Kong, living with a San Francisco family that has a "really nice dog" named "Ginger." That was followed by more personal blogs from Asian teens, all on the Xanga social network site. On at least one of them I forgot to tag it as foreign language, so I expected to be penalized on that count. I also spent too much time looking at the sites, fascinated by the intimate look at the bloggers and their lives. After about 35 minutes I may have earned a total of 30 cents. Obviously, not an efficient use of my time.

A natural-language search company, called Powerset, had a work order that seemed right up my alley. I had to answer factual questions after reading articles. I skimmed several items and found the answers to questions like "What band was Jerry Garcia in?" and "When was MTV started?" Piece of cake! After 10 minutes I earned maybe 6 cents.

Another task required me to read a product review and identify product features, for equipment like digital cameras. At 10 cents a pop it was fairly straightforward. The following task required me to locate e-mail addresses for a group of gyms and health spas, most of which didn't seem to have a Web site. That one seemed too much like work to me. Next, I tried out a task for Guessnow.com, suggesting future predictions that "have a compelling edge without character defamation," as the instructions advised. I asked people to predict when Lindsay Lohan would enter rehab again, only to have that question rejected later because "question does not make sense." Well, I think it does. Whatever. There went 7 cents down the drain.

Other tasks were just way too complicated to even attempt, like the ones where I would have had to extract data from different vendor contracts at various state governments (at 4 cents a pop, definitely not worth it) and find universal product codes for items in catalogs--too much research and not enough pay at 5 cents a task, if it's a valid answer.

MySpace was offering 50 cents for creating a tour map for a band on the Web site, but only if the band decides to actually use it on their page. Other companies were offering: 15 cents to write a review for cameras and cell phones; one cent to write a short (25 to 400 words) summary of your family's Thanksgiving tradition; 10 cents to write a health-related blog entry; 2 cents to comment on someone else's blog entry; 2 cents to vote on items at news aggregation site NewsBigg.com; and 10 cents to post an article entitled "Should I buy a radar detector?" that was written by a radar detector merchant to blog and article submission sites.

Some bigger ticket tasks were: $1 for people who worked at Gold's Gym or 24 Hour Fitness to answer a short survey; $2 to add numbers to statisitics wiki site Numberpedia.org; 50 cents to write short plot descriptions for movies ("avoid spoilers"); $3 to rewrite articles on cat training; 70 cents to tag stub articles on the African diaspora in Wikipedia; and 75 cents to record your screen and voice as you browse a Web site.

Granted, I did take notes for this article while I was completing these tasks, which no doubt dented my earning capability. But still, earning potentially 47 cents for an hour's worth of work isn't quite what I had expected, especially given that I could have earned $15 an hour doing data entry for one of the companies advertising on Craigslist.

I asked Peter Cohen, director and builder of Mechanical Turk, about the economics of the site. "There are some people who do this purely to make money and support themselves," he said. "There's a woman in Canada who uses her Mechanical Turk earnings to buy Christmas and birthday presents for her family."

And others use the credit they earn (you can either have your earnings transferred to your bank account or applied as credit on Amazon purchases) to buy college textbooks, Cohen said.

Hmmm. I figured that by the time I actually earned enough to buy a recently released book it would be out in paperback already.

Mechanical Turk isn't just about supplementing your income--it has also been used for more noble efforts. For instance, thousands of volunteers have been eyeballing satellite images of the Nevada desert on Google Earth looking for signs of a downed airplane ever since the disappearance of adventurer Steve Fossett on September 3. So far, nothing has turned up through Mechanical Turk, Cohen said.

Eager to find out how I fared on my Mechanical Turk tasks from the night before, I checked on my account on Amazon's site and discovered that so far, two of my tasks were accepted and I have earned a whole 20 cents. Woohoo! One task, the prediction question, was rejected, and 10 tasks are pending review.

I see there is also a list of pricey tasks for which I have met the requirements. Here's one I think I'm qualified for that pays a shocking $10: create a short video resume for Doug Leeds, vice president and product manager at Ask.com. But, given that I cover Ask.com for CNET News.com there would be a conflict of interest with that.

Instead, I think I'll try one of the blog writing tasks worth $4. Now, what can I say about gothic prom dresses in 500 words or less?

Police in India have uncovered a terrorist plot targeting the country's booming information technology economy, according to numerous reports on Monday, including one from CNET's own Indian correspondent, Dinesh Sharma.

The plot was reportedly hatched by a militant group seeking the separation of Kashmir from India. The plan included a hit list of companies located in Bangalore, which is home to some of India's most successful outsourcing firms, including Infosys and Wipro. Many American high-tech companies, including Accenture, Microsoft and Yahoo, have development centers there too. Police didn't disclose the names of intended targets.

Closer to home, the Bush administration has never been one to discourage outsourcing, even though it's a political hot potato. But it just got hotter this week with reports that the CIA is shipping suspected terrorists overseas, outsourcing interrogation to foreign intelligence agencies in such exotic locales as Uzbekistan.

Some suspect the main draw of these arrangements is the lax laws around torture in such places, but government officials say it's to save money. This Village Voice story spotlights a testy White House response to the issue.

Software developers in India may soon get a dose of what their Western counterparts are always griping about -- the fact that, any day, their jobs could be shipped off to foreign lands to the East.

Wipro, one of India's top three outsourcing firms, announced plans this week to open a software development center in Beijing, Silicon.com reports. And Wipro's Indian rivals are setting up outposts there too.

But the company apparently has mixed emotions about China. Just a couple weeks ago a Wipro executive took a defensive posture, claiming Chinese IT workers aren't as efficient as Indian ones and that the country's advantage in the outsourcing arena are overblown.

The Virgin Group is the object of much scorn this week in Scotland, according to the Times of London.

The company plans to close a 260-employee call center in the village of Dingwall, the self-proclaimed Viking capital of Scotland, and move the work to India.

The deal has outraged Scottish politicians and labor leaders, with one union official calling on Virgin to return more than $1 billion in government subsidies the company collected last year. Sir Richard Branson may have messed with the wrong Vikings.

Meanwhile in Denver, Colo., the cowboy capital of the West, some lawmakers would like to outlaw offshore outsourcing, the Denver Post reports. Democrats there are pushing for a bill that would forbid the state from working with companies that employ overseas service workers.

A vote on the bill was delayed this week after much questioning from Republican senators. One skeptic pointed out that provision would not let the state hire Microsoft or practically any other major software company to maintain the products it buys from them. Hmmm. Good point.

Well, if it's any consolation, officials from Denver to Dingwall and everywhere in between probably don't have to worry about losing jobs to Indonesia. A new report from Accenture says the place may offer cheap labor, but it's just too scary. Past riots in Jakarta and terrorism in Bali are keeping foreign companies away.

Sick of getting opinions about offshoring filtered through the media? Here's your chance to hear with your own ears some significant voices in the debate over shipping work abroad.

A Webcast is available of an offshore outsourcing discussion earlier this week involving John McCarthy, the Forrester Research analyst famous for predicting more than 3 million services jobs will head overseas, and Norm Matloff, a University of California, Davis professor and long-time advocate for software programmers. Rounding out the speakers were David Foote, president of compensation research Foote Partners, and Dean Lane, chief executive of software company Varitools.

The title of the event was "The big debate: Will offshore outsourcing positively or negatively affect the U.S. economy, your company and your job?"

Technology media firm TechTarget hosts the Webcast, which is sponsored by IBM. (IBM has been both hiring in the United States and moving work overseas.)

You can hear comments from the horses' mouths thanks to the Webcast, but you do have to jump through some hoops: an extensive registration process is required.

A new kid on the block promises to give offshore outsourcing a run for its money--by routing technology work to rural America.

Rural Sourcing is a start-up founded and largely funded by Kathy White, former chief information officer for health care giant Cardinal Health. White, also Rural Sourcing's president, has set up two facilities in Arkansas, has another center coming on line in New Mexico in January, and is in talks to open yet another facility in North Carolina.

Kathy White, president,
Rural Sourcing

The company can offer services such as application maintenance and Internet development for roughly 40 percent less than what other domestic tech outsourcers charge, White said. Rural Sourcing's fees are about the same as the overall cost of using an Indian outsourcer, she said--if you consider factors such as communication costs, travel expenses and inconvenience. "We think we're close to their total cost of ownership," White said in an interview Thursday.

The company has about 20 employees today. White hopes that number will grow to 50 to 75 by the middle of next year.

A key to Rural Sourcing's strategy is to work with universities, which can develop technology skills. For example, the company's facility in Magnolia, Ark., is located on the campus of Southern Arkansas University.

Rural Sourcing began pitching its services this summer and can boast of five major customers, including a large telecommunications company, White said. She said the companies haven't given their permission to be named publicly.

But that could change. After all, the concept of keeping technology jobs in the United States and helping often-depressed rural communities at the same time could amount to a public relations coup for a big U.S. corporation.

Rural Sourcing is a kind of crusade for White. She grew up in Oxford, Ark.--population 642.

"I believe in the people of rural America. I'm one of them," she said. "I think we'll shock a lot of people because we're going to be really good and low-cost. And we're going to be bigger than anyone imagines today."

If White is right, it will be good news for American techiesÂ?at least the ones in rural communities and those willing to move there.