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

Ubuntu Touch Gets Major Update and the OS Is Now Crazy Fast – Screenshot Tour

Ubuntu Touch has just received a new major update and the developers have made some serious changes to the operating system, which now feels a lot faster and the experience is a lot smoother. Read more

35 Open Source Tools for the Internet of Things

In a nutshell, IoT is about using smart devices to collect data that is transmitted via the Internet to other devices. It's closely related to machine-to-machine (M2M) technology. While the concept had been around for some time, the term "Internet of Things" was first used in 1999 by Kevin Ashton, who was a Procter & Gamble employee at the time. Read more

IoT tinkerers get new Linux hub & open platforms

Cloud Media, the maker of entertainment box Popcorn Hour, launched a project on Kickstarter, Inc. that will add to the growing number of smart hubs for people to connect and control smart devices. Called the STACK Box, it features a Cavium ARM11 core processor, 256MB DDR3 RAM, 512MB flash, SD slot, 802.11n WiFi, Bluetooth LE 4.0, Z-Wave, standard 10/100 Ethernet port, optional X10 wired communication, 5 USB 2.0 ports, RS-232 port, 2 optocoupler I/O, Xbee Bus, Raspberry Pi-compatible 26-pin bus and runs Linus Kernel 3.10. IT also features optional wireless communications for Dust Networks and Insteon with RF433/315, EnOcean, ZigBee, XBee, DCLink, RFID, IR coming soon. Read more

Citrix and Google partner to bring native enterprise features to Chromebooks

Chromebooks are making inroads into the education sector, and a push is coming for the enterprise with new native Chrome capabilities from Citrix. Google and Citrix have announced Citrix Receiver for Chrome, a native app for the Chromebook which has direct access to the system resources, including printing, audio, and video. To provide the security needed for the enterprise, the new Citrix app assigns a unique Receiver ID to each device for monitoring, seamless Clipboard integration across remote and local applications, end user experience monitoring with HDX Insight, and direct SSL connections. Read more