Language Selection

English French German Italian Portuguese Spanish

Insecurities over Indian outsourcing

Filed under
Security

Some say there's little risk, while others warn of serious hazards, including a threat to America's national sovereignty.

In the incident, former call center employees of Mphasis are accused of taking part in a theft of $350,000 from U.S. consumers' bank accounts.

In the wake of the theft, some observers have voiced concerns about the security of data being handled by outsourcers in India, including worries about weak procedures for checking employee backgrounds. According to this school of thought, the Mphasis breach could dramatically dent the amount of call center work shipped to outsourcers operating offshore.

"This was not a lapse of judgment or an issue of poor customer service: The incident was an organized and systematic plot to steal customers' money," John McCarthy, an analyst at Forrester Research, wrote recently. "Forrester believes that this breach, coupled with recent onshore disclosures of sensitive customer data, will have far-reaching negative connotations for the offshore BPO (business process outsourcing) space."

Not everyone shares this view. But even the perception of danger could hurt the market.

A report from rival researcher Gartner played down the security risks but made no bones about the seriousness of the situation. "The entire Indian offshore industry ecosystem--including...the Indian government--must act quickly and decisively to counter the perception that Indian BPO poses a severe security risk," the report said.

Business process outsourcing, or BPO in industry parlance, refers to farming out tasks such as customer service and transaction processing to a separate company. The work could be done in the United States, or completed in lower-wage countries such as India or Mexico. In addition, some organizations have set up their own operations offshore. Shipping tasks offshore has become a controversial issue for U.S. labor advocates.

At the moment, U.S. organizations devote only a small fraction of their budgets for information technology services--including BPO--to low-cost countries, according to a recent Merrill Lynch survey of chief information officers. But that share of the budget is expected to grow over time, from 0.9 percent in 2004 to 1.6 percent in two-to-three years.

Rest of Story

More in Tux Machines

Three great Android tools for Linux and Windows sysadmin

Systems administration isn't a simple job — and being able to respond to issues quickly is a definite plus. Not long ago, server problems meant receiving a phone alert followed by a trip to the data center to fix whatever was wrong. Today, having full-powered computers such as smartphones or tablets literally in your hand is a tremendous help when doing sysadmin. Load Android with a few key applications and you can remotely monitor servers and services, get alerts and warnings as they occur, and solve problems without any travel at all. Read more

KDBUS Submitted For Review To The Mainline Linux Kernel

It looks like KDBUS, the Linux kernel D-Bus implementation, is posed to be added to the next kernel release after Greg Kroah-Hartman sent out its patches today. Read more

Windows Phone Shrinks In Android-Dominated Europe, As New iPhones Boost iOS’ Share

Spare a thought for Microsoft, a relative newcomer to the mobile making business, after Redmond completed its $7.2BN+ acquisition of former European mobile making powerhouse Nokia earlier this year. If Microsoft was hoping to see quick marketshare wins in Europe once its hands were fully on the levers of production that has not come to pass. The latest 12-week smartphone sales figures from Kantar Worldpanel ComTech, up to this September, indicate that Windows Phone’s already small share of the smartphone market has shrunk in Europe — dropping 0.3 percentage points in aggregate across the top five markets in Europe (the UK, France, Spain, Italy and Germany). Read more

35 Essential Android Apps for Daily Use

This list of essential Android apps are the ones you must have apps you need every day. They help with email, weather, music, and handful of other essential tasks. Read more