Yahoo Downsizing In The United States, Hiring In India
Duncan Riley
44 comments »
Yahoo’s decision to purge 1000 staff members primarily from its United States operations (some in Europe) has been hot news this year. What we didn’t know when the announcement was made was that Yahoo was planning to expand its base in India.
Yahoo is establishing a new lab in Bangalore with a focus on long-term research. The lab will be “a center of excellence for next generation search and advertising technologies, focused on making the Web more relevant and simple for users and advertisers.”
According to the Washington Post, the new lab will be headed by Rajeev Rastogi (previously the head of Bell Labs India) and will hire “sociologists, micro-economists, and computational scientists among other categories of staff for the lab.” The exact number of employees the new lab will hire was not disclosed, however the figure is believed to be in excess of 500 people.
The move towards lower cost Indian operations is far from new, and Yahoo already has 1500 employees in India. The decision may raise eyebrows in the United States where offshoring jobs is still fairly unpopular in the broader community, despite its popularity in the corporate and startup sectors.
Offshore outsourcing is reasonable and lots of major IT companies do the same..
yeah export the jobs fuckers. try muni in SF or GreatMall in Fremont.. it is already looks like friggin Buttfakistan. Our own corps export high paying jobs and bringin in stinky free loaders to work at 7/11 in 10 years we will be known as New Butfackistan valley
People need to take a basic international economics class so they learn that outsourcing work to other countries is not a bad thing.
However Yahoo! is doing this to reduce costs, I’m afraid that the Yahoo! ship is still sinking too fast to save
Since yahoo doesn’t use phones, its perfect for them. In related news, venture backed video site realviewtv.com chooses not to outsource to india noting that the dollar is so weak, the indian’s average salaries are now higher than Semel’s 2005 salary.
Of course off-shoring is an OK thing, but not for research…how many breakthrough products have come out of one of these off-shore setups in India? (seriously….I’m asking for a list)
-Andrew
Dude,
you are reaching new lows every day. I still cannot understand the reason to bold-font the “in excess of 500 people”.
1. that’s change if you can look at overall Yahoo force.
2. what makes you think these are correlated. You didn’t mention the role of the 1000 people that were “purged” from the US offices.
3. And learn some names. It’s not Bangalor, it’s Bangalore!
Your posts are always without analysis. you are another one of these pundits in this country who love to divide people based on incorrect observations.
500 folks for a research lab is insane, duncan you must be wrong on this, 50 or 15 people more likely.
@4 : The dollar (unlike the south) will rise again
@6 : +1
@2 : Ask your doctor about Paxil
@3 : exactly… But I’m not sure if Y! is necessarily sinking. It needs far more financial leverage to maintain its ongoing investment in infrastructure though. The flip side is, if it can find ways to cut costs drastically while having a minimal impact on delivered value… well , Thats kinda the same thing
Folks #7
500 is the figure quoted by the Wapost, link in that paragraph. Not my figure.
6
you’re an idiot. You’re saying I’m trying to divide people then say I didn’t provide any analysis, I can’t possibly do both. There’s nothing divisive here, just facts, and I noted at the end that outsourcing can be a hot button issue in the US, which it is. FACT.
I am dismayed that the TechCrunch writers tolerate outright racist posts like #2.
Jeez Louise!
Yahooer, very sharp and astute analysis based on deep research. Now, drive your bus back to your trailer park and lament over Huckabee’s loss over your can of moonshine.
Agree with Folks - the number has got to be lower. Again, it is a “rumor”.
If Yahoo laid off 1000 people in research in the US and brought on 500 researchers in India, I would short the mofo all the way down to the basement. Something tells me (no, not Duncan’s perspicacity) that this is not the case.
I wonder how much of this has to do with qualifications and market? India has over 1 billion people which is 3 times the market as the US. This is a growth market.
And, they are graduating more highly skilled people when it comes to computers and engineering. Heck, many of the people who I get for tech support on my stuff who are from India have an engineering masters degree.
Is it really just about the money?
Folks 7, Doodz 11
The STARTING NUMBER for the Lab: 100 people.
Hindustan Times
“This new laboratory—with an initial team of 100 scientists and engineers—will be part of the expansion of its R&D operations in the country.”
Doodz,
my perspicacity involves reading multiple sources, even if I dont always quote them. Maybe you should try it some time?
@2 This is a racist rant.
DuncanRiley = LouDobbs , let me correct you. It isn’t Bagalor, nor Bangalore, the city is now called Bangaluru.
It will be interesting to see what tangible benefits comes out of this for Y!. The value proposition for offshoring to India has been in free fall of late. China looks attractive on paper but most will confide that in practice China is VERY difficult to do software development in due to language/Time zone/Govt/IP protection problems.
Eastern Europe seems to be the best offshoring alternative right now and Y! might do better to try this lab there.
I have to agree with @Andrew in his assesment of the quality of IP that comes out of India. Over a billion people have had an opportunity to create the next big thing for the last 10+ years with no determinable results.
the “center of excellence”? does that mean what they used to have was a “center of crap”???
@8 : The USD will not rise as it is f*cked
Yahoo can fire expensive USA workers and hire for less in India. Other U.S. companies can lay off their expensive U.S. workers and outsource jobs to third world countries for less money. Then, these expensive US workers with massive student loans won’t’ find jobs because they are in India. They will be denied opportunities for the remaining jobs here because their student loans are in default (listed on their credit report) as a result of being out of work. ( U.S. companies will not hire you because of your credit report. You might steal something.) The remaining jobs will be $8-9/hour retail jobs. They will not hire these out of work workers because they are overqualified and might quit. So they hire illegals instead.
These out of work professionals will have lot’s of time to surf Techcrunch and complain about outsourcing.
@Manu #15: If you really want to nitpick, then it’s either Bengaluru or Bengalooru.
Finally some wise moves from Yahoo. They should fire all the US employees and outsource all job to India.
Yahoo! has to make ends meet, PERIOD. Money and perception of ROI are critical. India can bring many +’s if things go well. Yahoo has to make some changes, and keep some money making ways going, marketshare and emerging markets are goldmines.
Hopefully jobs will come back to Yahoo! when/if the storm passes.
What is so difficult about this to get? OSS jobs, like yahoo, require yahoo to survive, and go through cycles. Thank god some IT people do not fully run the show.
When is TechCrunch writing being outsourced to India? That means salaries will go down, Arrington can get more cigars, and we’ll have better quality writing.
# 16, # 5
“Over a billion people have had an opportunity to create the next big thing for the last 10+ years with no determinable results.”
Big result needs not only talent but Funding!
There is immense talent in India (silicon valley guys might agree with this) but they lack in funding. Yahoo has recognized just that!
Microsoft, Google already have R&D centers in India.
This picture might change in another 10 years!
@yahooer #2: Its a long hard road… we’ve still not perfected the art of tuning *global-economy* to ensure that wealth and benefits continue to flow disproportionately more towards developed nations. Unilateral treaties help. Exporting democracy helps. Exporting capitalism without democracy works better. Dictators help. WTO helps. Wars help. We need more! You need to channel your negative energies more productively, its a long hard road and believers like you are what we need.
And, Great Mall is in Milpitas, not Fremont.
BOYCOTT YAHOO!!!
US companies looking to make an extra buck by cutting off the loyal employees that have made yahoo what it is. I am sick of these US companies waving the US flag outside the home office and meanwhile 90% of staff are in other countries. I am not picking on India so don’t get me wrong I understand why India is making it attractive to have companies setup shop it just I am sick of watching the US self mutilating itself and then saying what happened.
I think this is a sensational story. This is not like for like replacement. Yahoo has trimmed marketing and product jobs in the US; these are research positions in India.
The India research expansion is necessitated due to Yahoo facing stiff competition from Google in US for top quality engineers and scientists.
#25 i remember when Milpitas ans Fremont you could actually live in. Yahoo and google sucks $ from us based merchants, to pay for clicks that are mainly generated in Russia
and now Manufactured in India. and dumbfucks in US are ones screwd. Globalization just like any other utopian ideas only work in a books. You try to do business in China, or in Russia and import your shit there.. guess waht you will not be happy. and there 2 countries with fastest growing ecomnomies. Only one way any business can make money is MONOPOLY. and if US market is regulated then it your kids who will go to school. Globalization is a monopoly on a money machine, and money machine owned not buy US people. And fuck you verymuch i type too fast i know.
Take it easy guyz! Maybe few of these 1000 laid off people will start new companies (and then hire another 1000 people). If no one (out of these 1000 laid off souls) can start new companies then they did not deserve to be in Yahoo! in the first place! Isn’t yahoo supposed to be one of the pioneers in innovation? Oh..maybe they were (innovative) at some point…but not anymore!
Remember, your corporate leaders and politicians have told you that the only jobs that are being out sourced are the LOW end jobs. Advance jobs such as research and innovation will remained in the U.S.
Guess again.
Anyway, I think it’s about time that the U.S start sharing it’s wealth and technology with the rest of the world. It’s about time that the other countries can take advantage of the intellectual capital that the U.S has held on for itself for a long time. Sharing is good, it’ll only make this world a better place.
If TechCrunch wants to be retain its global audience, the writers should focus on technology news and avoid reporting layoffs, hirings etc like other commonplace news websites.
won’t sell it to MS for 43 billion, but they will ship jobs out of the country. Gee, what assholes
Good article about the death of Indian outsourcing:
http://www.forbes.com/home/ent.....ource.html
I can see why they’re doing this…we just opened 2 new offices in India…to give everyone an idea of the savings.
We pay about 20% of what we would pay in the U.S. (and that’s not us being cheap) - we’re actually OVER-paying to attract some talent away from the big companies like Microsoft, Google and Yahoo…
They work twice as hard and are very smart.
The only thing to be careful about is that interviewing can be a hell of a process. You hire about 1 person for every 50-60 interviews (no joke) - put out a job ad and you get SMOTHERED.
Mystery CEO
They work twice as hard and are very smart?
You must be a CEO… because CEOs are the only ones deluded enough to believe that!
I highly doubt they are only hiring in India for development. It more likely that a good percentage of the new hires will be in sales,
India is an emerging market in the interactive space, Yahoo is likely launching Ad Serving, Ad Exchange (Right media) and increasing their Ad Sales presence in India.
As a former Y! mid-level exec (sold ‘em my firm back in ‘04), the biggest joke internally was when a project was earmarked to be moved to the team in India. It’s considered the biggest death knell for a project inside Y!
Way to give Obama’s “punish the companies that outsource” stance a boost with California voters (though, this will resonate with voters all over the US).
YES, another outsourcing. The entire Silicon Valley companies need to outsource everything to India. Why wait? Do it now. India is the future.
1) Do you know that the 1000 people Yahoo! laid off were not from their research division. So how can you correlate these two news.
2) Do you know that Yahoo builds products specific to Indian and other emerging markets. which might require a research team specific to those markets.
3) Do you know that when people talk about “low cost” India labor, they are not referring to these PhD holders and scientists, who might cost as much as, if not more, than their US counterparts.
Now waiting for your response, where you are going to tell me why I’m an idiot. (Seriously, on a different note, looking at the way you have responded to some other readers, I think you need to be a little more tolerant to criticism)
India is a huge market for Yahoo, which is an American company. Yahoo, an American website is the No.1 most visited website website in India ahead of any Indian website according to Alexa. Yahoo, Google, Youtube, Orkut, all of which are American sites make money in India since each year many Indian advertisers advertise through Google and yahoo. Shareholders of yahoo and Google who are mostly American benefit from Indian advertising money spent on Yahoo and Google by Indian companies and citizens.
The Americans including Duncan Riley and other anti-India commentators want America to benefit from India’s huge market, but at the same time if yahoo hires in India, they oppose it.
This is not logical. If this sentiment continues, Indians must stop using American websites like Yahoo, Google and Techcrunch.
Why should we in India use Yahoo and Indian companies advertise in Yahoo if Yahoo does not hire in India?
I am from India and I know how you must be feeling about this change. If you think 500 is very large amount, yeah it is from your point of view, but in India its piece of cake and I am sure it will take only a year or two for total force to cross 3000 people. I have seen my company grow from 1000 to currently 5000 in just a year and still it wasn’t a surprise.
I run an IT company in India and all our work comes from the US. Never have we competed on pricing. Yes, with the currency differential what we offer works out to be cost attractive to our clients. What we offer to our clients is terms of quality and delivery is not different from any company in the US. But, we have the people and the ability to add more.
Yahoo, has come to India because of the quality and availability of skilled man power. Plus, there is great expertise in doing offshore work and handling client expectations from all over the world. I think it would be far more difficult to set up a 500 or 1000 man R&D unit in the US as compared to India.
The World is Flat….and we are going to keep seeing such setups happening.
Dollars fucked, the end.