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> Then the reality hit. Are we talking about the reality where the size of the global software outsourcing market is $618 billion and growing? https://groovete

> Then the reality hit. Are we talking about the reality where the size of the global software outsourcing market is $618 billion and growing? https://groovetechnology.com/blog/software-development/outsourcing-statistics/ https://groovetechnology.com/blog/software-development/outso...

Etheryte 2y ago
Even at its current size, the software outsourcing business is multiple orders of magnitude smaller than the software business itself. While there's money to be made, clearly the hype didn't live up to even remotely what it promised to be.
Nextgrid 2y ago
The market can stay irrational for longer than you can stay solvent. This is not to say outsourcing can't ever work, but the situations where it does work are much rarer than what every outsourcing vendor would like you to believe. I bet a previous client's attempt at outsourcing (well into the 6 figures now) is included in that number... yet the expensive onshore devs outsourcing was supposed to replace are still there 2 years later except now they have to also babysit the offshore idiots and fix their messes. But hey, the vendor got paid, the idiot executive who fell for their pitch wouldn't want to lose face, so it all gets handwaved away as a continuing success and more money gets thrown into the dumpster fire.
- TeMPOraL 2y ago
  FWIW, if you believe that long-term, the market is a good optimizing engine (I think it's a very reasonable and well-proven belief), then this is just a matter of time before things sort themselves out. The need for companies to get more value out of less spend won't disappear, nor will the comparative advantage of companies in lower CoL areas of the globe. That's two fundamental incentives on both sides that are aligned, driving the market to find the lowest-energy path from here to there. It'll get there, even if it ends up looking strange (like, idk., maybe cutting out management intermediaries but involving a middleman acting as insurance). That is, if LLMs won't leapfrog it all and end software dev outsourcing before it started to work well.
MyOutfitIsVague 2y ago
In my experience, I started my career 15 years ago cleaning up codebases developed by cheap outsourced developers. They were an absolute mess. Today, I work with many very talented developers overseas. People who develop code at my level of quality and above (and I am a stickler for high quality, maintainable code). The thing is how you research, what you expect to get out of it, and what you're willing to pay. There was absolutely a gold rush on bottom-dollar development by cheap overseas developers by management who had no idea how software really worked, and thought they could build a business on cheap offshore development. These were software farms staffed by unappreciated undertrained people from diploma mills. I saw truly shocking things. I saw code written entirely with gotos instead of loops, because the developer had never learned how to write a while loop. The companies spent way more in the long run trying to iterate, ask for changes, and ultimately having to hire higher quality talent for much more money. I agree with the GP. The LLMs will get better, maybe people will learn that you need an LLM with a skilled developer, or maybe the agents will get good enough to fully drive themselves properly, or maybe just good enough that a non-technical pilot can get good work out of them. Right now, "vibe coding" is largely non-technical people making messy, unmaintainable, insecure code. Some of these are programmers and non-programmers just playing around, but some people are trying to build money-making businesses off this, and it does feel like a very similar situation.
iamEAP 2y ago
My father never dissuaded me from the computer science degree I went for (starting in 2007), but later on in life, he told me that, at the time, he was worried about my choice because outsourcing was all the rage and everyone was saying there’d be no programming work in the states-that it was all going to be done in India. That reality in fact never materialized.
matsemann 2y ago
The market where I live is far larger than it was 15-20 years ago. So both have grown, the outsourcing didn't kill local as predicted.
- TeMPOraL 2y ago
  The growth of demand for software development is absurd and heavily skews people's expectations. It won't last forever.
  - FpUser 2y ago
    >" It won't last forever." And who cares if it is true? So far programming is one of very few professions when person can set themselves for life in a relatively short period of time. When / if it is gone there will be something else. I have few friends who'd switched to be a handyman. They are doing great from what I see.
    - TeMPOraL 2y ago
      > So far programming is one of very few professions when person can set themselves for life in a relatively short period of time. If you specifically optimize for it. Most people don't - they specialize and expect to be in their line of work for decades. > When / if it is gone there will be something else. There will be something else for young people who are just starting. If you're 20 years into a career and then your line of work disappears overnight, of course you can switch to something else - and enjoy your entry-level salary while competing for jobs with people who are 20+ years younger than you and have no meaningful costs or obligations yet.
    - Yoric 2y ago
      That very much depends on where you live. Also, on what you're optimizing for. If, like many, you're looking for a job that makes sense, for instance (e.g. working to develop technologies or research that you think can change the world for the better), you're probably never going to strike that particular gold.
stusmall 2y ago
I think that's a great point. There is a place for outsourcing. Some projects and organizations are well suited for it. Some projects end up only using outsourcing at supplementing some parts of the work. Some can't do it for quality or compliance reasons. I think we will see something similar with LLMs. There will be areas where it will deliver cheaper and faster. There will be areas where it will deliver nothing but disaster. It'll change the industry but not eat it alive. The folks talking about fully autonomous coding on the near horizon are dreaming.
- acdha 2y ago
  I’ve seen a number of outsourcing project failures. The two things they all had in common were that the organizations in question were terrible at managing projects but they blamed the developers for management’s inability to plan or make decisions, and they were trying for unrealistic savings – it wasn’t enough to save 30-50% on salary, they wanted 90% even if that was below the market rate for those skills even in India. The first one is definitely happening with the LLM bubble where companies really want to pretend that the hard part of the job isn’t understanding what to build and how to do so maintainability. The second one is going to be more interesting: I expect LLMs to put downward pressure on wages in a lot of places but also for smarter companies to realize that nothing short of true AGI is going to replace the need for people who can actually understand what the customer needs. If I’m right, this will swing the pendulum back towards specialists again – the seagull guys who come in, declare that their favorite framework will solve everything, and leave are more vulnerable to being replaced by an LLM than someone who knows how to code but is also bringing actual business-relevant experience and judgement which an LLM can’t have.
  - TeMPOraL 2y ago
    > the seagull guys who come in, declare that their favorite framework will solve everything, and leave are more vulnerable to being replaced by an LLM than someone who knows how to code but is also bringing actual business-relevant experience and judgement which an LLM can’t have. But that's just a continuous variant of the discrete-sounding claim that programming will get eaten by AI soon. After all, the "actual business-relevant experience and judgement which an LLM can’t have" is mostly not related to programming - and the better LLMs get at coding, the less value will the programming parts of the skillset have; take it to the limit, and it's just saying the managers and sales people will stay, while software developers will be gone.

Etheryte 2y ago

Even at its current size, the software outsourcing business is multiple orders of magnitude smaller than the software business itself. While there's money to be made, clearly the hype didn't live up to even remotely what it promised to be.

Nextgrid 2y ago

The market can stay irrational for longer than you can stay solvent. This is not to say outsourcing can't ever work, but the situations where it does work are much rarer than what every outsourcing vendor would like you to believe. I bet a previous client's attempt at outsourcing (well into the 6 figures now) is included in that number... yet the expensive onshore devs outsourcing was supposed to replace are still there 2 years later except now they have to also babysit the offshore idiots and fix their messes. But hey, the vendor got paid, the idiot executive who fell for their pitch wouldn't want to lose face, so it all gets handwaved away as a continuing success and more money gets thrown into the dumpster fire.

TeMPOraL 2y ago
FWIW, if you believe that long-term, the market is a good optimizing engine (I think it's a very reasonable and well-proven belief), then this is just a matter of time before things sort themselves out. The need for companies to get more value out of less spend won't disappear, nor will the comparative advantage of companies in lower CoL areas of the globe. That's two fundamental incentives on both sides that are aligned, driving the market to find the lowest-energy path from here to there. It'll get there, even if it ends up looking strange (like, idk., maybe cutting out management intermediaries but involving a middleman acting as insurance). That is, if LLMs won't leapfrog it all and end software dev outsourcing before it started to work well.

MyOutfitIsVague 2y ago

In my experience, I started my career 15 years ago cleaning up codebases developed by cheap outsourced developers. They were an absolute mess. Today, I work with many very talented developers overseas. People who develop code at my level of quality and above (and I am a stickler for high quality, maintainable code). The thing is how you research, what you expect to get out of it, and what you're willing to pay. There was absolutely a gold rush on bottom-dollar development by cheap overseas developers by management who had no idea how software really worked, and thought they could build a business on cheap offshore development. These were software farms staffed by unappreciated undertrained people from diploma mills. I saw truly shocking things. I saw code written entirely with gotos instead of loops, because the developer had never learned how to write a while loop. The companies spent way more in the long run trying to iterate, ask for changes, and ultimately having to hire higher quality talent for much more money. I agree with the GP. The LLMs will get better, maybe people will learn that you need an LLM with a skilled developer, or maybe the agents will get good enough to fully drive themselves properly, or maybe just good enough that a non-technical pilot can get good work out of them. Right now, "vibe coding" is largely non-technical people making messy, unmaintainable, insecure code. Some of these are programmers and non-programmers just playing around, but some people are trying to build money-making businesses off this, and it does feel like a very similar situation.

iamEAP 2y ago

My father never dissuaded me from the computer science degree I went for (starting in 2007), but later on in life, he told me that, at the time, he was worried about my choice because outsourcing was all the rage and everyone was saying there’d be no programming work in the states-that it was all going to be done in India. That reality in fact never materialized.

matsemann 2y ago

The market where I live is far larger than it was 15-20 years ago. So both have grown, the outsourcing didn't kill local as predicted.

TeMPOraL 2y ago
The growth of demand for software development is absurd and heavily skews people's expectations. It won't last forever.
- FpUser 2y ago
  >" It won't last forever." And who cares if it is true? So far programming is one of very few professions when person can set themselves for life in a relatively short period of time. When / if it is gone there will be something else. I have few friends who'd switched to be a handyman. They are doing great from what I see.
  - TeMPOraL 2y ago
    > So far programming is one of very few professions when person can set themselves for life in a relatively short period of time. If you specifically optimize for it. Most people don't - they specialize and expect to be in their line of work for decades. > When / if it is gone there will be something else. There will be something else for young people who are just starting. If you're 20 years into a career and then your line of work disappears overnight, of course you can switch to something else - and enjoy your entry-level salary while competing for jobs with people who are 20+ years younger than you and have no meaningful costs or obligations yet.
  - Yoric 2y ago
    That very much depends on where you live. Also, on what you're optimizing for. If, like many, you're looking for a job that makes sense, for instance (e.g. working to develop technologies or research that you think can change the world for the better), you're probably never going to strike that particular gold.

stusmall 2y ago

I think that's a great point. There is a place for outsourcing. Some projects and organizations are well suited for it. Some projects end up only using outsourcing at supplementing some parts of the work. Some can't do it for quality or compliance reasons. I think we will see something similar with LLMs. There will be areas where it will deliver cheaper and faster. There will be areas where it will deliver nothing but disaster. It'll change the industry but not eat it alive. The folks talking about fully autonomous coding on the near horizon are dreaming.

acdha 2y ago
I’ve seen a number of outsourcing project failures. The two things they all had in common were that the organizations in question were terrible at managing projects but they blamed the developers for management’s inability to plan or make decisions, and they were trying for unrealistic savings – it wasn’t enough to save 30-50% on salary, they wanted 90% even if that was below the market rate for those skills even in India. The first one is definitely happening with the LLM bubble where companies really want to pretend that the hard part of the job isn’t understanding what to build and how to do so maintainability. The second one is going to be more interesting: I expect LLMs to put downward pressure on wages in a lot of places but also for smarter companies to realize that nothing short of true AGI is going to replace the need for people who can actually understand what the customer needs. If I’m right, this will swing the pendulum back towards specialists again – the seagull guys who come in, declare that their favorite framework will solve everything, and leave are more vulnerable to being replaced by an LLM than someone who knows how to code but is also bringing actual business-relevant experience and judgement which an LLM can’t have.
- TeMPOraL 2y ago
  > the seagull guys who come in, declare that their favorite framework will solve everything, and leave are more vulnerable to being replaced by an LLM than someone who knows how to code but is also bringing actual business-relevant experience and judgement which an LLM can’t have. But that's just a continuous variant of the discrete-sounding claim that programming will get eaten by AI soon. After all, the "actual business-relevant experience and judgement which an LLM can’t have" is mostly not related to programming - and the better LLMs get at coding, the less value will the programming parts of the skillset have; take it to the limit, and it's just saying the managers and sales people will stay, while software developers will be gone.