For weeks Americans have been told that the outsourcing of high-tech jobs is good for our economy. So said Greg Mankiw, chairman of the White House Council of Economic Advisers in a recent report signed by President Bush. So, too, writes Thomas Friedman of the New York Times in articles praising the rise of call centers in India used for everything from making airline reservations and reading medical X-ray films to providing tech support for American computer firms.
Intercontinental outsourcing is a direct result of satellite communications and supercapacity undersea fiber optic cables. These advances have made the real cost of telecommunications independent of the distance between the two ends of the conversation. It costs the phone company about as much to call India as to call across the street.
Friedman praises Indian call centers for their ability to provide upwardly mobile jobs for educated Indians. Offshore technical centers certainly are cheaper for the American companies that contract for their services, but they come at the price of lost American jobs.
The globalization argument for offshore call centers is that they provide economical service, and that they actually make more jobs for American higher-technology workers. It is said that the Indian call centers use IBM computers, or Dell machines, or some other U.S.-built products. They use American-written software, and American-made chips.
The truth is different. The Microsoft keyboard in front of my Princeton Graphics monitor run by my Dell computer might have been made here; it doesn't say. The monitor was made in China, and most of the parts in the computer were made in the Far East. Microsoft has established major software coding and research facilities in India, so even Windows may not be an all-American product. My IBM laptop was made in Korea.
As the Washington Post reported on March 9, Indian call centers certainly aren't helping the economy in impoverished Clintwood, Va. In 2001 Travelocity, the online travel company, opened a call center employing more than 275 people in Clintwood. The county leased space for the center and sublet it for six years, at a loss, to Travelocity as an incentive to come to Appalachia.
Less than three years into the lease, Travelocity is leaving Clintwood for India.
Even if Indian call centers cost some jobs here, the idea might be a good one if the centers did their jobs well and lowered the price of purchases made by Americans. But I now have two weeks of frustrating experience with three companies. Their names and those of their employees have been fictionalized.
I recently wanted to install a home network to tie my computers together. Wanting to make things easy, I chose to stick with one brand for everything, an industry leader I'll call "Gearlink." I first tried installing the equipment on my desktop computer which used the Windows ME operating system. The gear didn't work, even though the equipment is certified for Windows ME, so I called Gearlink's 24/7 call center, reaching "Vinay" somewhere in India. He told me that I should upgrade to Windows XP, which I did. He also said that in order to install Gearlink properly I would first have to uninstall my firewall and antivirus software, a fatal mistake. In the few minutes I was "naked," I got hit by the Blaster worm and another virus, and had files trashed.
The American technician who answered the Microsoft "Blaster Hotline" told me exactly what to do to get my system clean. The call was free and the information correct.
Unfortunately, after the operating system upgrade my e-mail vanished into cyberspace. (I easily found the files, hidden and undamaged, just not linked to "Interscape," the mail program.) Interscape offered good tech support last year. Now the call is routed to India where I met "Balaji." Before I could talk to him, Balaji demanded a credit card and a $40 upfront payment. Two and a half hours later, and $40 poorer, I had most of my e-mail back, a job that should have taken no more than 15 minutes.
Now my hand-held computer wouldn't synchronize with the XP computer, though it had no trouble with the laptop running Windows 2000. So a call to the maker, "ComHand" was in order. One year ago ComHand offered exceptionally good, free, tech support and advice from an American call center, but no longer.
Back offshore. A technician tells me "Sir, your handheld is an old model (bought April 3, 2003 and still in warranty); it will not work with Windows XP, sir." I remind him that ComHand's Web site says it will. "But we do not recommend it, sir. You should buy a new one."
The next call to ComHand reached a "technician" who said that I should install a new service pack for the operating system, even though Microsoft warns that doing so would damage the operating system. I ask for a second-level technician and get 30 seconds of silence. I ask if she is still there; "Yes, sir, I am, sir." I ask again for a second-level tech, and the silent cycle repeats. I ask for a supervisor and am told she has no supervisor.
Twenty five bucks down my third offshore call center rat hole. My son and I talked about the problem on the phone, got an idea, and in 5 minutes the two of us got the handheld synchronizing perfectly with the desktop. We have no special training in fixing ComHand's products.
My problems had nothing to do with language difficulties, only with technical training and proper management. Without exception everything any offshore technician suggested I do was wrong or woefully incomplete. "Gearlink," "Interscape" and "ComHand" might be saving money on labor, but it's not worth the cost to the companies and the frustration of their customers.
Dell Computers, famous for support and service, invested heavily in an Indian call center, but has now given up on the idea. Customer satisfaction was simply too low, and customer complaints too loud. Dell knew that it could not afford to alienate its customers, and is back creating jobs in the United States.
There is a lesson here: Until offshore call centers can provide the service Americans demand, the fact that they save our companies money and give good jobs to Indians misses the point. They are a bad investment for U.S. companies and a disservice to Americans, both those who need help with their equipment, and those who need help because their jobs disappeared down the fiber optic cable.
- Physicist Peter Zimmerman, professor of science and security at King's College London, has been programming computers for 41 years.