8 ms·
Uber wants to cut costs by shifting its engineering to India
- breitling 6y agoShift innovation to India? Have they seen India's track record on tech innovation? The education system there does not produce very innovative people or engineers. However they are great at following exact instructions so I'm sure that part of engineering team will do well
- iamstupidsimple 6y agoThey produce plenty of competent engineers, but my layman's interpretation is the problem of capital being concentrated in Silicon Valley, so there's little chance for tech entrepreneurs to flourish within India itself.
- breitling 6y agoNo doubt they produce many great engineers, my argument is that they are not necessarily innovative (having studied in the same system, I've seen it first hand)
- searchableguy 6y agoYeah, that's correct. Most people are poor and afraid to venture into unknown territories. The consumer market isn't so receptive either for this reason. Coaching institutes and education centers are touted or seen as a path to wealth but they are just sad factories with tens or hundreds of students in one class.
- codegeek 6y agoYou are not wrong overall but the mindset is changing. It wil take many years though due to the systematic and cultural norms. Most Indians are taught to do "service" instead of "innovate" because it has been a poor country with tons of competition for good jobs. Only in the last decade or so, the younger generation is realizing that innovation is important and even though the Govt. is mostly inept in encouraging this, I have seen first hand how the kids think these days and it is a good start. With more people moving into the Middle class, their access to resources is improving as well. May takes decades though.
- ryanbrunner 6y agoI wonder how much of this is the engineers themselves (and their training), and how much is due to how the industry was built and continues to function in India. Traditionally, innovation and creativity wasn't a positive thing for the type of work that was outsourced there, and I'd imagine there's a good deal of momentum that has created a culture of valuing accuracy to spec and timeliness over creativity and innovation within companies. I certainly don't see a lack of creativity or innovation from immigrants from South Asia working in North America.
- senthil_rajasek 6y agoEvery country had to start somewhere. This could be their start.
- varshithr 6y agoI am from Hyderabad and one of my friend works at Uber Engineering here. From what I understand, the quality of engineers matches to that of his US counterparts, if not better. He got his degree from IIT, a tier 1 college in India. I agree that India has not been the best in terms of tech innovation but the situation is changing. The start up ecosystem is booming here and investments are following too.
- _tw9j 6y agoRelative to what? India has 1.34 billion people. If other countries put a million self selected students to compete with each other in a dog fight, I am sure the resulting 50k might have good chance of being similar. Startup ecosystem is booming on foreign investment especially from china. Local investment is still dire.
- wobbly_bush 6y agoHow does this reply contribute to the discussion?
- searchableguy 6y ago> He got his degree from IIT, a tier 1 college in India. Students from IIT in India are filtered from millions of students. They only take about 10-15k students every year and the rest are in NIT and other relevant institutions (around 50k). About 1 million self selected students participate in jee-mains every year. I only meant to highlight that OP's friend may be biased compared to the common situation here. Here is the article for chinese investment in top Indian startups - https://www.vccircle.com/here-s-a-snapshot-of-key-chinese-investors-in-indian-startups/ https://www.vccircle.com/here-s-a-snapshot-of-key-chinese-in... With government trying to shut down foreign investment, I don't see investment opportunities in India increasing.
- jitendrac 6y agoThat is incorrect. The tech innovation track is bad because most of talented indians join mostly Trading based family business. Most of Agarwals,Jains,Brahmin are mostly businessman.(most indian big startup-enterprises are from this community.ex.Paytm,Reliance,Birla,Flipkart,OYO,OLA) for example,I am jain(Baniya). I am having masters degree in IT(2013),had offer from US based MDM startup still I chose trading. Even now I spend 20 hours a week in IT work(hobby),from node projects,System drivers to my trading business specific IOT devices and even DIY Electronics project. But I dont find myself in IT business in near future. My cousin who is also master degree holder in IT, He runs successful family owned supermarket with 15000+skus. His store is more advanced in tech then bigger competitors which I bet will earn him fruit in next 3-4 years. Its personal choice not lack of innovation or talent.
- sbmthakur 6y agoI doubt if there's any region in the world that comes close to SV when it comes to innovation. Indian engineers, at least the ones hired from the top institutes, can certainly innovate if they are provided the right environment.
- vsskanth 6y agoHard disagree. Most of the talented Indian engineers in top N tech companies in the US came from the Indian education system. They all migrated here in search of better opportunities. Things are however changing in India due to the rapidly growing startup ecosystem which eventually lead to good careers and high salaries for software engineers back home. This is giving people less of a reason to move.
- wobbly_bush 6y agoThis comment is pretty ill informed on the tech scene in India. Most large companies already have engineering offices in India dealing with varying complexity of projects. You are probably only thinking of outsourcing companies.
- softwaredoug 6y agoIsn’t this a dupe from a few days ago: https://news.ycombinator.com/item?id=23713291 https://news.ycombinator.com/item?id=23713291
- foepys 6y agoHow does the SV crowd here see this? Considering that even entry web devs with only bootcamp experience often enough make >$100,000, outsourcing to India is a good idea, economically speaking. Could a successful outsourcing project by Uber threaten all SV tech jobs?
- katbyte 6y agoNo. To get the same amount of quality in india you’ll be paying roughly the same - and then have cultural and timezone barriers.
- Arfiraaa 6y agoI don't think it's fair to assume the quality of Indian workers is worse. They are paid less purely because of cost of living and locational differences. Uber is smart enough to know this and it's the exact reason they will end up paying less for similar quality. Also, in every company there are jobs that are trivial and jobs that require talent. I assume the more trivial jobs like bug fixing will be outsourced, while the rest of the engineers are kept for product design.
- barry-cotter 6y ago> They are paid less purely because of cost of living and locational differences. Cost of living is a red herring. No one’s going to pay me more if I live in Manhattan rather than the suburbs of Boise if they can avoid it. It’s all about the locational differences. If there’s a thick, liquid market for the product you’re selling, your labour, you’ll get a good price for it. If there isn’t employers have substantially more power to set wages. A lot of the reason engineers in SV get paid more is that they’re just better but the engineers in Boulder are pretty great too and fewer of them are getting those wages, even fewer in Boise. All about the competition for talent.
- ghaff 6y agoIt's all interrelated though. If Silicon Valley CoL were more along the lines of the many Tier 2 areas where there is a lot of tech of various kinds, the big SV employers wouldn't have to pay as big a premium to get people to relocate. They'd still pay a premium to get the talent they want, but they wouldn't have to also basically cover the difference in housing costs needed. But it's complicated. For that matter, you could argue that the perks of Bay Area weather and great number of employment options should make the Bay Area attractive even if the salaries weren't great relative to CoL. But there's enough competition among large employers who generate enough value per employee that they can afford to offer top-shelf salaries so they do so to entice the people they want. To the last point, I don't expect dramatic short term changes. But to the degree that things tilt more in the direction of remote work and small distributed offices, I expect some equalization of salaries at least within the US.
- ravenstine 6y agoWouldn't it only be fair for us to be handing more jobs to those with greater need in countries like India? Share the wealth, right?
- bluedevil2k 6y agoFair to whom? The investors who are now taking on a greater project risk? The SV developers who would be losing out on jobs?
- Dumblydorr 6y agoHow about your job, do you volunteer to have it outsourced to a poor engineer? Would they do what you do as well? Don't they have their own ridesharing companies? I don't see why they need uber's jobs, that wouldn't bring much wealth to them but to institutional American shareholders mostly.
- Arfiraaa 6y agoAssuming this question is asked in good faith, this is obviously not the right way or anyone's idea of distributing wealth. And ultimately this is for Uber's profit, not the good of India.
- codegeek 6y agoI know you are being sarcastic but this is called "capitalism". Not doubt a country like India benefits tremendously from the jobs created by foreign companies BUT it is not a charity. Companies are doing it because they see enough value and profits for their shareholders. It has nothing to do with being fair or not. If you truly want outsourcing to stop, create better incentives for the companies to hire locally. Until then, welcome to a global world.
- interdrift 6y agoWhat a huge mistake in my opinion if that goes through. Everyone who worked with indian companies should keep an eye on what's going on. Far too much more damage can be done!
- anonms-coward 6y agoI think you are comparing it to the wrong scenario. Hiring for your own company(Uber in this case) is far different than outsourcing to an Indian company like Infosys and TCS. Microsoft already has a huge presence in India, and so does Amazon. I have interacted with engineers in FAANG in both India and the west coast, and there is no huge quality difference in people on the same job levels.
- ageofwant 6y agoWell this has worked great for Boeing, a once great American engineering company. On the other hand India has an excellent education system and highly skilled engineers, and any capital flow away from the five big cities in the world that sinks the vast majority of it can only be a good thing.
- _tw9j 6y ago> India has an excellent education system Explain in which way is it excellent? Which part do you think Indian education system does well relatively?
- bhaavan 6y agoA significant portion of the current SV crowd on H1b, is a product of the indian education system.
- _tw9j 6y ago> A significant portion of the current SV crowd on H1b, is a product of the indian education system. Could you be more elaborate? I can see that statement meaning wildly different things on HN and it doesn't answer my question.
- new2628 6y agoOK, I'll bite. The top academic institutions in the exact sciences and engineering (old IITs, IISc) are excellent by any standard, and the students are top notch, due to the large pool from which they are selected and the brutally tough selection process. Example: a significant number of the top CS researchers in the world are graduates from these institutes.
- _tw9j 6y ago> The top academic institutions in the exact sciences and engineering (old IITs, IISc) are excellent by any standard, and the students are top notch, due to the large pool from which they are selected and the brutally tough selection process. It's a result of huge population and most institutions being trash so students are concentrated in one place. That is in no way a feature of the education system itself.
- ingend88 6y agoIndia is well suited for building and supporting applications like this since it has an extremely good talent pool that can manage and deploy solutions. Uber app in itself is not that difficult to operate and hence I strongly believe this is the right thing for shareholders.
- temporarysdwvit 6y agoHow is code quality control in India?
- thrawa934234 6y agoYou pay peanuts and you get monkeys (and 4chan-esque racist memes, for the rest of us).
- sbmthakur 6y ago> How is code quality control in India? Depends on the devs and the kind of team they are working in. It's difficult to provide an objective answer to that question.
- crowquill 6y agoIt is cheaper because the cost of living and running an office are significantly cheaper than that of SV. Indian engineers are not always bad engineers that write low quality code.
- yesplorer 6y agoNo, it's cheaper because of huge difference in cost of living. $10,000/month may not go far in SV, but in parts of India, you can live like a king, literally, with servants and such. Rent for a studio apartment in India will cost less than $200. I'm not kidding. But a similar space in SV can cost 10 times more of that.
- anonms-coward 6y agoI think you replied to the wrong comment.
- temporarysdwvit 6y agoNo, it’s the right one, I removed controversial sentence
- KingOfCoders 6y agoThe challenge with outsourcing is management overhead and turn around times. Biggest mistake I see my customers make is outsource and not control the quality of the engineers. Inhouse they have a sophisticated and long recruiting process. When outsourcing they take the first they get (and as a new customer, be assured, you do not get the best engineers but you need to fight to get them).
- _red 6y ago>turn around times my company tried to outsource a ancillary product we develop in 2011-2013 timeframe. It wound up being non-viable and we brought it back in-house. I think many don't see how pernicious turn-around times can be. They continue to build upon each other like compounding interest. It can be a very very hard loop to break out of. The cycle of question -> answer -> further question -> meeting can grind progress to a halt when each iteration takes 12 hours.
- wobbly_bush 6y ago> The challenge with outsourcing This article is not talking about outsourcing but offshoring. Uber still has total control on the people, the project and rewarding the right behavior. It will just happen in India instead of the US.
- KingOfCoders 6y agoWorking for a very large tech company as a technical manager with lots of offshoring to India and outsourcing to East-Europe and the Middle-East it didn't feel there was a difference between how outsourcing and offshoring worked regarding engineer quality or turn around times. But you are right.
- mabbo 6y agoA better option: shift it's engineering to everywhere else in America, and go full-remote, but pay less. Imagine if Uber told it's developers: we're cutting salaries by 40%- but you are now full-remote, and we want you to live somewhere less expensive than SV. Spread out across America! A lot of folks would quit. But some would see the incredible opportunity. In that situation, I'd move somewhere like Chattanooga TN- average rent at around $1000/month, vs SF's $3000-5000. Food is cheaper too. And being a city, it's far less conservative than you'd think (well, okay, it is TN). They could cut their engineering costs dramatically while improving the overall lifestyle of their developers. And given we're soon going to be in a post-pandemic world where tightly-packed open offices don't exist anymore, they'd probably just be ahead of the rest of us by a few months if they did it.
- bathtub365 6y agoAsking people to take a pay cut that means they need to uproot their families to make ends meet is completely unreasonable. I think they’d suddenly find themselves spending much less on engineering staff but probably not for the reason you think.
- chocks 6y agoI’m genuinely curious why companies don’t do this? It seems like a great deal, many cities in US are great with decent cost of living. I used to live in Kansas before & home ownership is cheaper and time zones are usually better. Maybe the total cost of hire is still higher? idk
- ghaff 6y agoBecause the cost of living delta is mostly just home ownership. Yes, that trickles down to somewhat higher prices for contractors, child care, etc. but it's mostly rents and houses. So $50K/year say is probably a pretty reasonable cost of living adjustment between the Bay Area and most reasonable low CoL areas. Cut more than that and you're also cuttings savings and spending power for things that are priced similarly across the continental US.
- vsskanth 6y ago
- elicox 6y agoFirst we move the factories to others countries and now we are moving the brains. If this extend, this will be the end of middle class in west society.
- exhaze 6y agoAs someone who worked at Uber from 2014-2018, I'd like to weigh in with some observations based on my experience. 1). While Uber has been very Bay Area-heavy, it has had a distributed engineering team for many of its core operations for a very long time. For example, many of its core infrastructure was built in Europe. Cross-timezone collaboration hasn't been the smoothest, but of all the large "FANGish" tech companies, Uber actually has the most experience with non-HQ teams building business-critical systems. Even companies seen as very progressive in terms of eng culture, like Stripe, seem to keep the core business close to HQ (this is my subjective observation, and I'd love to proven wrong here, because I think Stripe, as a whole, is awesome). 2). India is a country with many people and many engineers. If there's one strong believe I can state in this post, it's that there are many incredibly talented engineers who are living in India and are choosing to stay there. Uber has experience in building engineering teams outside of HQ. It's not a sure thing, but I think they can do it. Happy to answer any other questions or comments. (I guess as a disclaimer, I have zero financial stake in Uber, but I have some friends who still work at Uber, so that may or may not influence my opinion)
- cworth 6y ago> of all the large "FANGish" tech companies, Uber actually has the most experience with non-HQ teams building business-critical systems. Tangential, but the core product of AWS, EC2, was developed in South Africa and (largely) continues to be today.
- slenk 6y agoHuh, I didn't know that. Although I would argue that S3 is the core product
- anonms-coward 6y agoI think we might see more instances of this happening, not less. The thing is SF salaries are very high compared to just anywhere else in the world. There are many reasons for that (high rent, high concentration of talent), but I doubt these justify paying 300k when Uber can pay 80k to an engineer in India. To people saying the difference in salary is not large, it absolutely is large, and they can check https://www.levels.fyi/SE/Uber/Google https://www.levels.fyi/SE/Uber/Google for some data points. Not to mention this is just salary, cost of employment will include more things like real estate costs, health insurance, all of which will make this even bigger. Also, India has good enough engineering talent that product quality shouldn't be an issue given good technical leadership. If companies can hire people straight out of bootcamps for entry level jobs, they can sure get better value by hiring someone having a very good CSE education at much lower cost. Even the vast majority of work at FAANGs doesn't require a Dave Cutler or Jeff Dean. For example, majority of engineers at Google are not working on Search, Colossus,BigTable,Spanner,Borg or the most important technologies. Most engineers just need to know how to use BigTable/Spanner, and that is much easier than designing them.
- thomk 6y agoIf I were Lyft I would fairly quickly start plastering "Build in America" everywhere. If it isn't true, I would make it true.
- tedjdziuba 6y agoThat’s a bit racist.
- tijuco2 6y agoI was a Uber driver for two years and year after year they keep saying they are struggling. I really don't get it. On a ride where passenger pays 20 bucks, they usually keep something like 8 dollars. How can it not be profitable? The computational and human resource necessary to make a ride happen can't be that high. Maybe they should fire their CTO and CFO.
- playeren 6y agoIt's the growth that costs money. Operational costs have only recently become a concern, after becoming publicly traded.
- bgdam 6y agoWow, some rampant generalization in this thread. What most people outside of India seem to fail to understand is that most of the experience they have had and stories they've heard of are based off of poorly paid, not very highly skilled engineers employed at body shop consultancies. There is also another class of software engineers in India who are as good as SV engineers who work at companies like Ola, Bookmyshow, PayTM, Flipkart etc. building quality products at quite a large scale. This is the kind of engineer who is also hired by FAANG/Microsoft/Uber etc. And these engineers are paid very well in comparison to the body shop guys. So when Uber says they might shift engineering to India, that doesn't automatically mean quality is going to shit.
- anonms-coward 6y agoYup, Flipkart has one of the best mobile websites of any ecommerce app. Far better than the likes of Walmart and Target.
- ulfw 6y agoWhat big thing do they still have to develop in their core app? They don’t to send self-driving etc to India.