As business leaders consider the viability of hiring low-wage, offshore developers for their software projects, they must understand that the cost of labour is only one piece of a larger outsourcing puzzle. In fact, the very success of complex, highly collaborative software engineering projects can be jeopardized by offshoring because of the communication problems and management challenges inherent in a long-distance partnership. This white paper describes some of the difficulties experienced by companies that send projects offshore and explains why it is often more advantageous to collaborate with a local software development firm.