I would say that the title -- the title search is essential to the issue of title insurance, and title insurance is essential to an efficient mortgage market.

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Even though the government does a good job, it's hard to search the records. You've got to understand them. You've got to figure out how to summarize them. You've got to decide what's important, what can be ignored. It takes some skilled people. So the value proposition of the title search (inaudible) it's really the expertise of the people who do the search.

First American is a company that benefits greatly by offshore processing. Any data company benefits greatly, because you can move data to be worked on by others to anywhere in the world wherever it's most efficient. We have about 5500 people, for instance, in India alone. We have an equal number of people in the Philippines that are not employees of ours but that are dedicated to working on our products. So we're very committed to our offshore processing, and it's really been a good thing for our efficiency as a company.
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And as I mentioned earlier, we have a lot of people in India. And it's easy to say we're going to send business to India; we're going to send functions to India. It's hard. You've got to have an infrastructure. We have a leadership infrastructure. We have over 5000 people in India. We're set up to move more and more functions to India. We do it throughout the Company. We haven't done it as fully as we can in Title Insurance. So when we say we're going to improve our margins, it's not just we hope, it's we will. We have put in motion the things that we need to do for those margins, and we'll start to see the benefits of that in fairly short order.

Just when Mr Kanth was wondering about the next steps, he met the president of a title company based out of Baltimore in 2003-2004. He told Mr Kanth that there was a refinance boom in the US which resulted in a huge backlog in terms of production. Incidentally, his brother M Sujay Kanth, who is now the COO of ESS, happened to be in the US to explore business opportunities. They took up this opportunity. This was their first break. They met with the title official and looked at the process. "Initially, we had no clue of what was going on and it was very hard to grasp. We took it as a challenge and Sujay got trained in their office for about 40 days after which we started the transition to my India office from 2004," the doc said.

Now, ESS has its own title insurance company in the US so it is basically involved in the entire process. But, as far as the India operations are concerned, it is handling most of the tasks other than disbursement.

The clients are primarily insurance companies, a few lenders also use the services -- a 70:30 split. The five top players in the US title industry are Fidelity National Financial, First American Title Insurance, LandAmerica Title Insurance, Stewart Title Guaranty and Old Republic Title Insurance. Most of the above-mentioned companies are in Fortune 500 league. ESS does business with two of the companies and are in a partnership with Stewart Title.

"We get a little more automated every day," [Parker] Kennedy [,Chairman and CEO of First American,] says. "In the old days, if you wanted to double your business you had to double your people. Now you can double your business and increase your staff maybe 10%."

The tech push must continue, he says, because one day economic rationality and digital reality will catch up to the title industry. Real estate ownership records, always open to the public, are going online, alongside all sorts of other data. Today anyone can instantly learn a property's square footage, its sales price history, even view satellite photos, at virtually no cost. If records are instantly accessible and accurate, the need for title insurance will fade away. "Eventually insurance won't be an important component of the product," he allows.

So Kennedy hopes to harness digital technology to create a new business. Rather than broker one piece of information for an exorbitant cost, he hopes to collect all manner of real estate skinny and sell it to banks, insurers, real estate agents and direct marketers.