http://www.computerworld.com

For SeaCode, offshoring means three miles off the coast
Founders promise 'the price of India with the proximity of the United States'


News Story by Patrick Thibodeau


JULY 11, 2005 (COMPUTERWORLD) - What San Diego-based start-up SeaCode Inc. plans to do is nothing if not novel: anchor a cruise ship three miles off the coast of Los Angeles, fill it with up to 600 programmers from around the world, eliminate visa restrictions and make it easy for customers to visit the site via water taxi. The two men behind the venture -- Roger Green, who describes himself as an IT and outsourcing veteran, and IT consultant David Cook, whose job history includes a stint as a ship captain -- recently discussed their plan in an interview with Computerworld.

Roger Green of SeaCode Inc.
What is the business model? Green: The promise of the benefits of outsourcing in distant lands doesn't come free. Most of the gotchas are related to the geography and to the cultural difference.


What are some of those gotchas? Green: Communicating requirements, doing knowledge transfer [and] managing the project are very difficult to do even when you are in the same building, [let alone] when it's across the world.


That's the same argument made by nearshore providers in Canada. Cook: But we offer the price of India with the proximity of the United States -- that's the differentiator.


How does that work? Green: The model is based on making a platform, if you will, to house these engineers, this workforce, which is very close to the U.S. but which is in fact not in the U.S. We can pull programmers and engineers from anywhere in the world. A fact of life is there are different skills that are stronger in one country versus another.


Do you have a ship yet? Cook: No, but we have one in mind. We hope to have it set up and ready to run by the beginning of [next] year. She is a used cruise ship.


David Cook of SeaCode Inc.
Why anchor three miles off the coast? Cook: It's just more expensive for us to sit alongside a dock, because you have to pay for the berth space.


Does U.S. labor law apply? Cook: U.S. labor law does not apply except on a U.S. flagship. The flag of the ship will provide the labor law -- more than likely [the ship will be registered in] Vanuatu, the Bahamas or Marshall Islands. Their intellectual property laws, as well as the laws governing seamen, are very similar to the United States'.


What will life be like for your employees? Cook: The pay is about three times what they earn in India today. Each one will have their own room. They will get meals provided for them, cleaning provided for them, shore leave, laundry and the facilities of a cruise ship. This ship is a working cruise ship that we're going to buy. There will also be a doctor on the ship. The normal working shift will be 10 hours.


What is the salary? Cook: Approximately $1,800 a month.


What is your pricing going to be relative to India? Green: We will be approximately the same price as the distant-shore companies. We will take a little less margin than they do.


Do you expect U.S. residents to apply? Cook: Absolutely. Approximately 50% of the resumes that we've received are from U.S. residents.


Are you expecting any legislative efforts to block what you're doing? Green: We're not going into business for political reasons. What we're trying to do is accomplish several things: provide new jobs for Americans; [provide] a better deal for American companies that need to be successful in engineering new products to be competitive in a global market; and third, we want to keep the dollars spent on this in the United States. This is a step in the right direction and is not, in fact, part of the flow overseas.