Re:Dear business people, an iOS app actually takes a lot of ...
by biot on Tuesday January 31, 2012 @11:47PM
(#3536738)
You can live like a king in India for a few thousand dollars a month. In San Francisco, you'll be lucky to pay your rent. As a result, those developers in India are happy to ask for less if that results in them getting the work since $2K/month in India buys them the same (or better) lifestyle as $2K/week in San Francisco.
Besides which, they're competing against all the other workers in their country. If someone charges $50/hour and gets a lot of work for a similar skill set as you, wouldn't you try charging $45/hour to get the business? If the supply of workers is high and the demand for those workers is low, it does become a race to the bottom. Additionally, they must charge less than their American counterparts because of the inconvenience of being in a timezone where the start of the day in India comes after the end of the day in the US, the language/culture barrier, legal considerations (if someone rips you off, you have better legal options available if they're not half a world away with a foreign court system), and so on.
I'm sure if they could still get the work and charge more they would. However, consider an American-based company wanting development work done. If they have a choice between a $100/hour American worker and a $100/hour Indian worker, odds are very good the American will get the work for all the above reasons.
Besides which, they're competing against all the other workers in their country. If someone charges $50/hour and gets a lot of work for a similar skill set as you, wouldn't you try charging $45/hour to get the business? If the supply of workers is high and the demand for those workers is low, it does become a race to the bottom. Additionally, they must charge less than their American counterparts because of the inconvenience of being in a timezone where the start of the day in India comes after the end of the day in the US, the language/culture barrier, legal considerations (if someone rips you off, you have better legal options available if they're not half a world away with a foreign court system), and so on.
I'm sure if they could still get the work and charge more they would. However, consider an American-based company wanting development work done. If they have a choice between a $100/hour American worker and a $100/hour Indian worker, odds are very good the American will get the work for all the above reasons.