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Analyzing The Outsourcers

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In This Issue:
1. Editor's Note: Analyzing The Outsourcers
2. Today's Top Story
    - Microsoft Shares Tumble On Spending Plans
    Related Stories:
    - Microsoft Expands System Center
    - Microsoft Nearly Finished With Windows Live ID Deployment
3. Breaking News
    - Google Condemned For Click-Fraud Settlement
    - Mozilla Pulls Major Firefox 2.0 Feature
    - Sun Needs Layoffs, Cost-Cutting: Channel Partners
    - EDS Lands $1.7 Billion IT Contract At Kraft Foods
    - New SocketShield Said To Stop Zero-Day Exploits
    - Debate Breaks Out Over 'Tag Spam'
    - China Ready To Swipe Spam Crown From U.S.
    - Lumus Develops Optical Imaging-Based Display Technology
    - AOL, Weblogs Launch Financial Blog Network
    - MySQL Launches Community Development Site
    - Firm Sells Patents Targeting Ads To Mobile Devices
4. Grab Bag: News You Need From Around The Web
    - Warnings Over USB Memory Sticks (BBC News)
    - Traditional Advertisers Move Online (The Wall Street Journal)
    - Electronic Golf Ball Finder (Gizmag Emerging Technology Magazine)
5. In Depth: Google
    - Google Offers Free Version Of 3D Modeling Software
    - Google Places Firefox Ad On Home Page
    - Google Sued In Israeli Court
    - Google's Growth Outpaces Rivals
    - Consumer Input Spurred OneBox
6. Voice Of Authority
    - 'Outsourced' Programmers Finally Get Same Benefits As Laid-Off Factory Workers—A Fair, But Costly, Development
7. White Papers
    - Managing Software Requirements
8. Get More Out Of InformationWeek
9. Manage Your Newsletter Subscription

Quote of the day:
"Find a job you like and you add five days to every week." -- Jackson Brown, Jr.


1. Editor's Note: Analyzing The Outsourcers

As a researcher at InformationWeek, I have the opportunity to read a lot of research. Most of the outsourcing research that passes through my E-mail pertains to job loss or the employment implications of outsourcing on IT careers. In fact, with the release of our National IT Salary Survey, there was an article devoted to just this topic. But the goal I've been tasked with is to determine how successful outsourcing partnerships are, and which outsourcing vendors are truly helping customers meet goals and save money. And it was you, the readers, who set this goal. We've had many requests to revisit our Analyzing the Outsourcers research, last conducted in November of 2004.

Back then, InformationWeek Research conducted a survey of more than 300 IT professionals, all customers of various outsourcing firms. We asked those IT professionals about their outsourcing plans, spending plans, and satisfaction with their providers.

We've just started fielding an updated version of this research and would like any and all customers of outsourcing vendors to sign on and weigh in about your partnerships.

While most would consider data two years old to be ancient history, some of the results from the previous wave of this research are still thought-provoking:

- In 2004, nearly three out of five companies were spending $1 million or more on outsourcing, and a quarter were spending over $10 million. Contrary to popular belief, most of these dollars stayed onshore. For every dollar spent with outsourcers, an average of 76 cents stayed in the United States, 5 cents went to Mexico/Canada, and 19 cents went offshore. How does this spending compare to outsourcing spending in 2006? Give us your input.

- Outsourcing is often a way for companies to find expertise not readily available within the organization. This is why nearly half of organizations surveyed in 2004 reported that operational expertise was the most important factor driving companies to outsource. Tell us why your company outsources.

- Outsourcing customers were generally satisfied with their outsourcers, and seven out of 10 companies stated their outsourcing relationship met or exceeded expectations. Rate your outsourcing vendors.

Now it's your turn. Check out my blog and tell me about your organization's outsourcing successes and challenges. Even better, participate in our 2006 Analyzing the Outsourcers research. Not only will you be heard by your vendors, but you'll also get a free copy of the results.

Lisa Smith
LCSmith@cmp.com
www.informationweek.com


2. Today's Top Story

Microsoft Shares Tumble On Spending Plans
The stock price fell 11%, a five-year record drop, after Microsoft said earnings would be hurt by increased investments aimed at fending off rivals like Google. Among Microsoft's areas of investment: software services.

Related Stories:
Microsoft Expands System Center
Microsoft unveiled two new System Center products and said it plans to get into the software asset management business.

Microsoft Nearly Finished With Windows Live ID Deployment
The technology will allow someone who has subscribed to multiple Windows Live services to sign in to one and be simultaneously signed in to all the others.


3. Breaking News

Google Condemned For Click-Fraud Settlement
The settlement won't adequately compensate harmed advertisers or penalize Google, says an attorney who has a related case pending against the company.

Mozilla Pulls Major Firefox 2.0 Feature
Mozilla Corp. developers yanked one of the most prominent features from the next version of the Firefox browser after deciding it couldn't be finished in time.

Sun Needs Layoffs, Cost-Cutting: Channel Partners
Just increasing revenue won't be enough for incoming CEO Jonathan Schwartz to return the company to profitability, Channel Partners says.

EDS Lands $1.7 Billion IT Contract At Kraft Foods
The deal, which goes into effect June 1, will move about 670 Kraft IT employees to EDS.

New SocketShield Said To Stop Zero-Day Exploits
Startup Exploit Prevention Labs is offering free downloads of its beta zero-day exploit protection software, which is meant to serve as a "Band-Aid" until software flaws are patched.

Debate Breaks Out Over 'Tag Spam'
Friends and foes of search engine optimizers locked horns at this week's Search Engine Meeting in Boston.

China Ready To Swipe Spam Crown From U.S.
U.S. junk E-mailers still lead the way, but a report says Chinese spammers are hot on America's heels.

Lumus Develops Optical Imaging-Based Display Technology
New technology enables personal screenless displays by projecting images and data from computers, DVD players, or VCRs into the viewer's eye.

AOL, Weblogs Launch Financial Blog Network
The new network is a collection of individual blogs, each dedicated to a widely held public company, that provides independent analysis, news coverage, and commentary.

MySQL Launches Community Development Site
MySQL Forge allows members to share articles and tutorials through the site's wiki, post and maintain projects in its directory, and offer sample code snippets in its repository.

Firm Sells Patents Targeting Ads To Mobile Devices
The WayPoint patents, which go up for bid in an attempt to help their maker emerge from bankruptcy, help push information or advertisements to GPS-equipped cell phones.

All Our Latest News

Watch The News Show

In the current episode:

John Soat With 'Have News, Will Share'
Intel restructures, Microsoft rationalizes, Apple recycles, and China virtualizes.

Alex Wolfe With '5 Things You Didn't Know About The iPod'
Alex lets you in on some little-known tidbits about the iPod.


----- The latest research, polls, and tools -----
2006 InformationWeek IT Salary Adviser
How does your pay rate? Use our new and improved tool to compare your pay against the results of our 2006 National IT Salary Survey.

InformationWeek National IT Salary Survey 2006
This free InformationWeek Research report provides an unparalleled view into trends in IT salaries and compensation plans.
-----------------------------------------


4. Grab Bag: News You Need From Around The Web

Warnings Over USB Memory Sticks (BBC News)
U.S. military secrets were found in USB sticks on sale outside an airbase. Smart phones, iPods, and USB memory sticks are posing a real risk for businesses, warn security experts.

Traditional Advertisers Move Online (The Wall Street Journal)
The packaged goods industry is increasingly stepping up Internet spending.

Electronic Golf Ball Finder (Gizmag Emerging Technology Magazine)
We've written about a few golf ball-finding mechanisms in our time, but none as expensive or as accurate as the BallFinder SCOUT. The device exhibits an astonishing capability in digital imaging and tracking technology, using a video-based camera that can search up to 600 square feet in one second, or almost one-seventh of an acre in 10 seconds.


5. In Depth: Google

Google Offers Free Version Of 3D Modeling Software
Google SketchUp helps create models of a variety of items—including houses, sheds, decks, home additions, and woodworking projects.

Google Places Firefox Ad On Home Page
The ad promotes the key advantage supporters claim Firefox has over Microsoft's Internet Explorer.

Google Sued In Israeli Court
ML, an Israeli women's fashion chain, claims Google is allowing surfers to enter ML's name in the search engine and reach the Web site of a rival retailer instead.

Google's Growth Outpaces Rivals
Americans submitted 6.4 billion keyword queries online in March, up 15% from the previous year.

Google: Consumer Input Spurred OneBox
Google's OneBox for Enterprise, the culmination of a partnership with several software and hardware vendors, will be released in beta this week.


6. Voice Of Authority

'Outsourced' Programmers Finally Get Same Benefits As Laid-Off Factory Workers—A Fair, But Costly, Development
Given the myriad ways in which one could suddenly find himself or herself out of a job, Paul McDougall asks, is there any justification for the government singling out any specific category of workers for special benefits—like an extra year's worth of unemployment payments?


7. White Papers

Managing Software Requirements
Requirements may be the most critical aspect of the software development cycle. MKS Requirements 2005 enables you to capture, store, and manage requirements as a fully integrated part of the development process.


8. Get More Out Of InformationWeek

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