TrendOutsourcing software development to China
There is a growing trend to outsource software development to China because of the advantages that country offered relative to its main rival, India; but there is a national security aspect to all of this
We are waiting to see how software companies offering products to the homeland security and defense markets would react to this initiative by Dallas, Texas-based NewMarket Technology (OTCBB: NMKT). The company said that it would offer U.S. firms software development and maintenance support services provided by its operations in China. NewMarket is a U.S. leader in software development outsourcing to China, and the company projects this to be a billion dollar industry.
NewMarket launched operations in China last year, and subsequently signed more than $20 million in contracts with Chinese companies. The Company is now aggressively marketing its Chinese software development capabilities to United States firms. The company says that China offers competitive software devolvement and support services when compared to India, and that China is currently graduating more English speaking software engineers than India. China also has a more developed national infrastructure, and lower labor cost.
In an effort to introduce U.S. firms to the company’s capabilities in China, NewMarket hosts regular Information Technology Trade Missions to China for IT professionals to learn more about the software development and maintenance capabilities available in China today.
Coming back to our observation in the first sentence: There will be no rush by U.S. companies developing software for the U.S. government to avail themselves of the services of Chinese programmers. Worries about security and backdoor software will see to that. There is, however, a trickier problem here: Different agencies of the U.S. government encourage contractors developing solutions for the governments to make their solutions compatible with COTS (commercial off the shelf) applications. Now, as more and more of these applications have substantial development work done on them by programmers whose loyalty is not always easy to ascertain, it is more likely than not that the current trend toward COTS-compatible solutions will be reversed.
