The economy may still be trying to pick itself up, but one beneficiary of tighter budgets is outsourcing marketplace oDesk. Web developers and software engineers looking for project work can find jobs on oDesk, and employers can post jobs. Workers download PC-monitoring software which lets employers keep track of exactly how long they are on the job, even if it is in their pajamas at 3 AM.
As a result, oDesk publishes aggregate data on the “oConomy” and how many collective hours a week are being billed through its service. In July, the hours worked on oDesk surpassed 100,000 a week for the first time, and $65 million worth of work was posted on the site. In contrast, oDesk workers are earning about $6 million a week (because the value of job postings is for the entire job and not all get filled). oDesk takes a 10 percent cut, implying an annual revenue run rate of $7 million or $8 million.
That is still a drop in the bucket of the overall tech economy, but it is an indication that outsourcing is growing in the down economy. Competitor Elance, which covers a broader set of industries, shows similar trends.
oDesk is backed by Benchmark Capital and has raised $29 million, most recently a $15 million round last year.
Surely the fact that the amount of users now is vastly greater than 2004 makes this data useless, surely an average hour of workers from 2004 and now would be a better statistic.
That was in regards to the “In a tight economy”, this data shows nothing but the growth in oDesks users, it doesn’t reflect upon an increase in hours per user because of the economy.
Spyware? I would not work for oDesk unless I am really desperate…
Spyware? Come on! This insures that oDesk buyers are paying for what their oDesk provider is getting. It just keeps everyone honest. You sign off and sign on as you are working for one buyer or another, so its not like any personal information is being captured. It is a simple screen-shot of what you are working on. If you are not signed in….no screenshot! But, it is this aspect that makes oDesk so popular with Buyers. They know what they are paying for and also know if you are surfing the web for personal reasons and expecting to get paid for it–which happens a lot in many office buildings. The oDesk buyers do not pay for non-productive time and if you are an employee worth your salt, then you wouldn’t EXPECT to get paid for non-productive time.
My experience with odesk was frustrating. I personally found a developer that used classic tactics to ramp up the time they were spending.
I appreciate that this was my experience of just one developer and isn’t enough to judge an entire outsourcing site on.
However, I found the odesk website very hard to use, and very difficult to find the correct parts for resolving issues. It felt at times like they’d buried some things in the website so as to make it hard for people to find in the hope they’d give up looking for things (eg dispute policies). I requested contact information to ask about things in person and I never received any phone details. I was promised a phonecall and got nothing.
So in summary it felt like they didn’t want my business. So screw you guys, I’m going back to using elance and rentacoder until I’m convinced there’s a good reason to test you out again.
Jessie – I’m sorry to hear you had a frustrating experience. Feel free to reach out to me directly if you’d still like to ask about anything oDesk-related. ericafenik @ odesk . com (remove spaces)
this could also be interpreted as “more developers are out of full time work, so they migrate towards oDesk”, or the site is just growing at its normal pace.
GetAFreelancer.com is showing similar growth..
http://traffic....=odesk.com&
Alexa? Hard-hitting statistics you got there!
100k hours a week work? hmm, I think these people are some kind of superheros right?
It is cumulative for all their developers… not on developer per week… duh ?
Yay to you for saying what needed to be said!
oDesk is amazing – we’ve been using it for over a year for all sorts of tasks, and find that the contractors are generally high-quality and the system is seemless.
I wouldn’t say they are all high quality. The good ones are quite expensive. Many write unmaintainable codes. Few scammers here and there.
Maintainable code you only get by giving developers enough time to reiterate through their code, refactor, improve test coverage, etc.. Code doesn’t just come out perfect first time around.
Half baked, yet working code is the best you’ll get for your average ‘build me a myspace clone in a week for 500$’ type of project.
I totally agree!!
People want 24 hour turn around development schedules and yell and scream that some other guy said he could do it cheaper…..If someone wants a Youtube clone with a butt load of Jquery and a robust search engine with custom search results for $300 and then complains that its crap……..these are common issues with being a developer on Rent A Coder, Freelance, Scriptlance, Odesk, etc.
What is needed is a project manager for each job to coordinate the work. The projects should be bid on a per task basis instead of the overall project. If each task/ticket is a bid and pro-rated based on an hourly basis then this would protect the developer and the customer. The key is that the developer is not paid until a ticket is accepted by the customer.
The other big key I think is the developers should be under one roof and not a bunch of rouge developers from all corners of the world.
I have noticed that out of 20 projects of hiring Indian coders that all 20 projects turned into a nightmare!
I prefer to hire only Chinese workers. Issue with China is that most devs are trained in Microsoft technologies and need some training time for OpenSource technologies. I have had wonderful results with China over India. Other thing about Chinese is they are not game players and are a joy to work with.
One consistent thing I have found with all developers is they don’t often show up on time mainly because the power or internet has gone out.
oDesk is great – just don’t use Indian contractors. Those are the people Ive had the most trouble with. They find different ways to ramp up your time just for a simple change. I quickly went through 2-3 guys when I saw what was happening.
Other than that, there are some REALLY good guys on there…I recommend oDesk. It’s a great service. Just make sure you can interview them on IM before anything.
I prefer to get my business from elance & guru personally, if we even bid out or submit bids on any of those sites.
It does seem like everyone wants to “duplicate facebook for $250″ or you’re dealing with individuals who can’t code, manufacture hours, and generally drive the quality developers out of the picture.
I haven’t seen many consultants interested in that kind of bidding environment since it’s typically as described above. Referral work seems to go a lot further for us than any of those sites.
I love Odesk. I’ve posted and completed over 100 projects in the past year. Love the contractors I hire and now have a viable business while working for the man. Sure, there is always risk when hiring a contractor, but the buyer must take responsiblity.
For the comments that the good ones are expensive. Firstly, that’s true with any skill. Secondly, I’ve yet to hire an expensive programmer, editor, web developer, content writer, graphics editor, video editor, etc.
For the comments on India contractors – gees -what a stereotype. I’ve likely hired from 20 different countries including India. Nothing but positive comments.
One more point: The monitoring software is only required for hourly workers. Most of my jobs are fixed fees requiring no monitoring. I trust who I hire since I take responsibility for it.
Simple calculation give us approx $15 per hour. This is what average contractor earns there . Its a shame.
$15/hr is good based on the geographic regions of some of the labor sources.And remember most are not possessed with owning a BMW and a mcmansion. The western world could learn a lot from this new economy.
Anyone remember blade runner……
America has lost already manufacturing jobs, now it’s loosing IT jobs. $15 hour do not even pay a rent for my family and I am not talking about BMW and mansions. Surely, there are some poor countries where this is a decent money but in a few words – it sucks, man. This is a holocaust for IT job market in developed countries.
Pilot
You need to get way more creative with building your income.
I have found that earning money as an American is like catching $100 bills and no one is around. its the Gold-Rush if you are creative
Sorry I do not share your feelings.
unless your specialty is building crappy clones for “entrepreneurs” on a tight budget (<$1k) then I don’t think you have anything to worry about. “Real” software development isn’t going anywhere anytime soon. Local/in-house development is still the gold standard.
Pete-
Outsourcing should be more like $4 an hour which would yield a salary of $640+ a month. In China, India, Vietnam, etc. this is good pay.
If your from America, UK, Canada, AUS, etc. then you would need to charge $35+ an hour to make a decent income.
But I know for a 100% fact that the average salary for a dev in 3rd world developing countries is about $4 per hour.
Saying people worked 100,000 hours sounds great in the abstract but what does it mean? How many total users are there? What is the average billable hour? Etc…
Michelle – the answer to your search for more details about oDesk’s data can be found on our oConomy page: http://www.odes...mmunity/oconomy
The quality of the people oDesk suck, most do not understand programming and oDesk hass them certified very high with some type of evaluation criteria. I even complained to them about a horrible experience and nothing came out of them.
Worst company to deal with.
Yea oDesk sucks bigtime. I posted a small project up there and was flabbergasted by the poor quality of responses I received, it was just a huge waste of my time. On top of the that I got harassed with phonecalls and emails from “oDesk Support.” Stay away from this cesspool.
I’ve found that there are a number of people that post ridiculously low rates and expect to get ridiculously highly qualified people. I don’t waste my time with them either; I won’t work for peanuts. But peanuts to me may be a fortune in another country so that is probably where your responses came from. So, maybe you weren’t advertising the post adequately or expecting too much for too little?
I’ve been using oDesk for about 18 months now, and overall find it to be a great service. As has been mentioned, you do have to do your homework and expect to find wildly varying rates based on experience and geography.
But, if you are willing to invest the time (to provide detailed specs) and money (for quality, not lowest cost) you can get projects completed relatively quickly and at overall costs that are considerably less than local choices. I’ve even had local developers I’ve worked with join just because it makes my managing easier.
I’ve read through a number of the comments, and I have to admit that as an oDesk provider, I could not live on the income that I currently make, but…I only average 10-20 hours a whole week. I live in rural OK and would have to drive 35 miles one way to make the money that I do now, which involves wear and tear on your vehicle, a lower trade in due to mileage, not to mention the gas savings. I would have to have a work wardrobe, would have to pack lunches or eat out, and would not have the time to do other important things in my life, like the laundry. So, I supplement my husband’s income doing something that I love. I am not a techie, either. I write! Odesk is NOT just for IT and tech jobs. They offer just about any type of job that you can possibly outsource. And, at the end of the day. I have a job!!!!
“oDesk workers are earning about $6 million a week (because the value of job postings is for the entire job and not all get filled). oDesk takes a 10 percent cut, implying an annual revenue run rate of $7 million or $8 million.”
6 million per week * 52 weeks * 10% = run rate of $31.2 mil I believe. Pretty serious numbers given it should be a very high margin business.
Let me begin by saying that (certainly) any freelance marketplace like oDesk is going to have a few issues. But I don’t think the comments being left on this thread are entirely representative of what oDesk can really mean for a lot of people. For buyers looking for talent, it can mean a huge talent pool to choose from at great rates that you won’t find elsewhere. For providers of service (such as myself) its a great opportunity to build something great with your life. I’ve been working FULL TIME on oDesk since October of 2008. I worked for around 4 months part-time while doing my regular day job – but I was getting so much work that I simply quit by day job and now I work wherever I want, in the comfort of my pajamas. It is very liberating. I don’t think that the very FEW bad experiences of other people who have tried oDesk should keep others from giving it a shot. There’s a few bad apples in any bunch. If you’re savvy enough, you can pick through those and find lots of great talent in many areas – saving yourself a bunch of money. So if you’re an employer considering oDesk, consider this:
- oDesk providers run the “odesk Team Client” software while working for you; you can review the provider’s work diary to see exactly what your provider was doing during the time he or she was logged on to your project. You don’t get that kind of control in an in-house setting.
-Your invoicing, billing, and payroll is automated. Everything is reviewable and then the oDesk system pays your provider right from your account.
-You have the option of hiring lower-priced providers with great skills from all over the globe. Big companies outsource all the time – how do you think they are so profitable? You can really increase your bottom line using oDesk.
Give oDesk a try. Most employers are very impressed with the results they receive and the quality of the deliverables that they pay for.
Thank you Susan! I have yet to have a buyer of mine complain and I am proud of the quality of work that I deliver. It is a win-win situation for any number of Buyers and Providers!
It’s definitely what it is – if somebody posts a project and is focused on being charged by whatever amount of hours are spent by the developer working on the project, and agreeing to the hassle of monitoring the # of hours officially spent on it – it is truly great.
On the other hand, there are sites like rentacoder.com, which rather use a price-per-project-completed model, which obviously has its own weak sides too, but hey – isn’t it what customers want after all? To get the task done?
Which sounds simple, but leaves a lot of room where you get to points like clarifying what the actual needs are and being able to estimate the amount of work needed; still, I personally think GOOD (which means both skilled and experienced) developers SHOULD be able to do, no matter how vague the initial description is. If it’s vague – clarify it, break it down, estimate the pieces, create a schedule and work it out.
I’ve been using rentacoder.com for 4 years, and thanks to that, I was able to go up from 15$/hour (typical Odesk rate) to 30$/hour, which is still competitive for many US-based businesses.
But overall I think oDesk’s model attracts poor developers – those who cannot tell what needs to be done in order to MAKE it -> so they’re willing to focus on # of hours; and surely they can ‘work on the thing’ and it will be a legitimate activity in terms of the oDesk’s tracking app – but can thinking and picking up the right tools to CUT the time really be captured?
I’d like to see other stats like % of successful / failed projects, % of projects completed in time or even in 120% of initial estimated time, raw hours mean nothing, a lot of people come to IT every year, but what does it tell about the effectiveness of the platform from a customers’ point of view?
I happen to be one of the “top” users on ODesk – they keep begging me to take part in this discussion and defend the great system they have running.
In all truth, ODesk is a money making, slave-run machine. I was offered a job at ODesk and was turned down because my hourly wage ($14/hr) was too high. Again, they slave people and allow “buyers” to enslave providers for $2/hour.
No justice, i hope the site burns in hell! And yes, i’m bitting the hand that feeds me
I too am a top provider on oDesk and I couldn’t be happier. I currently work for 4 different buyers and make between $10 and $11.75 an hour. I started my rate at $6.00 in order to build a reputation, but I couldn’t expect to get jobs when I did not have feedback from satisfied clients (buyers), could I? So, since December 08, I have given myself 4 raises, something that would NOT have happened with any other company where I had a desk and computer. You also have to consider that I don’t spend money on gas, nor do I have wear and tear on tires etc., I don’t have to buy clothes, I can eat at home, I can do laundry on my breaks (I just sign out of oDesk when away from my desk). There are tons of advantages and I don’t feel enslaved at all. In fact, if I have an appt. or just need to take a day off, I do. I also went on a month long road-trip this summer, traveling from OK to VA to PA to NM to AZ and back. I worked from the motorhome while traveling but worked greatly reduced hours, and thoroughly enjoyed myself. One other word–when I am actively looking for jobs, I can spend up to 4 hours a day applying and composing cover letters. Not getting one job does not seem like a reason to hope they burn in hell! Maybe you just need to work harder at finding the perfect jobs for you? They ARE out there!
As a “Top 25″ Provider on oDesk, averaging 40-50+ hours a week providing SEO/SEM/SMM services to my clients, oDesk has allowed me to work from home, at any time of the day or night, and not worry about the hassle of payment, time tracking, etc. Plus, I am building up a reputation on the platform that makes me even more attractive to future buyers…all in, I would have to say oDesk has been a tremendous boon to my career in the digital economy and has kept me buried and paid, plus I am actually turning down tons interview requests during these uncertain economic times. By keeping me “on the clock” I am 1000% more productive and disciplined about freelance work hours. I must gush about oDesk, it is pretty much the best thing that has happened to me!
That’s a lot of hours.
I’m curious how many of those hours were actually spent doing useful, clean and quality code?
It would be nice to know also how those hours are distributed geographically. I’m sure there is a lot of hours spent in India…
oDesk is probably not the place for a Silicon Valley type of income, but if you combine low living-cost areas (what city folk call fly-over country) with reasonable hourly rates, say $25 – $35, you can make a living working at home at your own pace.
I make much less than I used to make in a densely populated sprawl, but I count not commuting to and working in an office, spending more time with my kids at reasonable times of day, and choosing what I work on and when as much higher benefits than that extra $10 or $15k a year I would have to spent on ridiculous mortgages in an ugly suburb.
To me it’s the extra quality of live that oDesk (or freelancing) provides that attracts me. Let them call it a slave machine or whatever, obviously they haven’t worked in oppressive day jobs long enough to appreciate the freedoms that freelancing at home offers.
I’ve been on odesk for less than a month. I have already got two contracts out of it …. so I am impressed so far. However I am really doubtful about some of the rates bid … on both the contracts I won I have stuck to my guns and gone with a rate that is acceptable to me here in the UK. This has been accepted both times.
However on one of the jobs I have won the odesk stats show that 1 person has been interviewed (which I know is me) and that the rate is 9 dollars per hour – well my rate was 20 … is odesk attempting to downplay rates???
I also wonder how many jobs are negotiated outside the system after the fact at higher rates … i.e. I really don’t think that the odesk stats reflect what is really going on here.
So far for me the system is really working but I take all the stats with a pinch of salt … stick to your guns and value yourself at whatever you are worth!
If true, is this a good thing or a bad thing?
It’s definitely good. Quality work at quality prices. And, most non-U.S. contractors are making more than they would otherwise.