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 MATE Projects Donates Money to Debian, MATE, and Syncthing Developers

The Ubuntu MATE project does something very admirable each month. Its makers contribute financially to other open source projects that are being used in the operating system, and that is something that doesn't happen all the often in the FOSS universe. Read more

Wine 1.7 Series Turn Two Years Old, No Sign Of Wine 1.8

Today marks two years since the start of the Wine 1.7 development series. While it's been two years of doing bi-weekly development releases, there's no sign of Wine 1.8.0 being ready for release in the near future. Read more

Today in Techrights

Leftovers: Software

  • gtkmm now uses C++11
    All the *mm projects now require C++11. Current versions of g++ require you to use the –std=c++11 option for this, but the next version will probably use C++11 by default. We might have done this sooner if it had been clearer that g++ (and libstdc++) really really supported C++11 fully.
  • Pixman Baking ARMv6, PowerPC 64 Improvements
    Pixman 0.33.2 RC has many new ARMv6 optimizations, bug fixes for PowerPC 64-bit, and various other fixes and enhancements to the MMX code.
  • Obnam 1.13 released (backup software)
    I have just released version 1.13 of Obnam, my backup program. See the website at http://obnam.org for details on what it does. The new version is available from git (see http://git.liw.fi) and as Debian packages from http://code.liw.fi/debian, and uploaded to Debian, and soon in unstable.
  • MusicTube Review - Use YouTube as Your Source of Music
    MusicTube is a very interesting music player designed for multiple platforms using YouTube as the music source. It's not made for locally hosted music, and you can't add other online sources, but YouTube is a huge resource.