In fact, according to Forrester Research, offshore outsourcing will account for 28% of IT budgets in Europe and the United States by 2005 and the benefits are substantial:

Reduce Costs
Develop software at significantly reduced costs, while decreasing the risks of costs overruns and late projects. Analysts estimate that by utilizing offshore resources, companies can save between 15 to 65% on their software development budgets (Source: Aberdeen Group, Forrester Research, Meta Group).

Organizational Flexibility
Expand the organization's software development capacity at minimal costs, while freeing up internal resource for specific projects that cannot be outsourced.

Access “Hard-to-find” Resources
Companies automatically gain access to a broader pool of programmers with a wide variety of skills. Take advantage of a highly experienced development organization without exposure to the costs of a long-term commitment.

Shorten Development Cycles
When companies do not have the manpower to complete projects quickly enough to gain a competitive advantage, they can utilize an offshore outsourcing company to find short-term assistance and implement “follow-the-sun” development processes for rapid completion of projects.

If you are an ISV, the advantages are just as important. By substantially reducing development costs and internal staff, and bringing products to market more quickly, you can effectively extend your cash flow and increase sales and marketing focus without reducing quality.