After Y2K insurers couldn't wait to replace old operatingsystems. They thought it was a race for survival. Nowthat they've survived, the jittery economy has upped the urgencyfor legacy replacement, but carriers struggle to afford theseprojects. Software acquisition costs are a fraction of theirimplementation expense. CIO's need qualified people whosecosts won't overwhelm the benefit. Meanwhile, legacy systemsdon't just disappear.

Offshore outsourcing rates can make the price tag of a longproject not look so bad, but offshore brings communication andcultural barriers. Dramatic time zone differences make theever-popular agile project, which needs proximity of teams,impractical. It's tough to ignore offshore rates, but projects liveon spreadsheets only until they begin, and there are nearshorealternatives.

A study published by Global Services ranks Halifax, Nova Scotiasecond among emerging information technology destinations in NorthAmerica. Nova Scotia hourly rates for senior programmers,technical architects and other lead resources are significantlylower than nearshore rates in the States.

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