Transcript A Global Review of the Translation Market Place

A Review of the Global
Translation Market Place
Renato Beninatto
COO and VP of Consulting
Common Sense Advisory, Inc.
Insight for global market leaders
Copyright © 2006 by Common Sense Advisory, Inc. All rights reserved.
Bona fides
 20 years making mistakes in the translation
business
 Last 4 years spent gathering information I wish I
had and sharing it with people who don’t want to
pay for it
 Over 1000 pages of published data about the
translation industry
 Lots of unpublished data
 Absolute independence… to the point of losing
money because of it
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
Agenda
 Market today
 Trends
 What doesn’t matter?
• Branding and quality
 What clients really want
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
Market Data
 87% of translation buyers outsource most or all
of its jobs
 ≈ 5,000 companies with more than 5 employees
–
–
–
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42% U.S.
41% Europe
12% Asia
5% R.O.W.
 Outsourceable translation market in 2006 will
reach USD 9.6 billion
 We estimate market growth at 7.5% p.a.
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
TOP 20 TRANSLATION COMPANIES
Rank
Company
HQ Country
Revenue in
US$M
Employees
Offices
Status
1
Lionbridge Technologies
US
405.0
4000
50
Public
2
L-3
US
372.3
n/a
n/a
Public
3
SDL International
UK
142.9
1500
50
Public
4
TransPerfect/Translations
US
74.0
385
30
Private
5
RWS Group
UK
66.4
332
8
Public
6
SDI Media Group
US
65.0
200
23
Private
7
Xerox Global Services
UK
60.0
200
4
Public
8
Euroscript s.a.r.l.
LU
59.2
580
10
Private
9
STAR AG
CH
52.0
790
35
Private
10
CLS Communication
CH
38.6
280
14
Private
11
Logos Group
IT
36.5
120
17
Private
12
LCJ EEIG
DE/IT/BE/ES
26.5
159
8
Private
13
Moravia
CZ
25.2
381
9
Private
14
Merrill Brink International
US
24.5
140
4
Private
15
McNeil Multilingual
US
24.3
200
5
Private
16
Hewlett-Packard ACG
FR
21.7
65
6
Public
17
Thebigword
UK
21.0
108
7
Private
18
Welocalize
US
20.5
104
5
Private
19
Skrivanek
CZ
18.5
350
50
Private
20
VistaTEC
IE
15.6
123
5
Private
Which sectors are buying language
services? Technology and medical top list
0%
Technology
Medical
Advertising and Marketing
Manufacturing
Financial
Government
Legal
Multicultural or ethnic
Trade
Non-governmental
Academic
Multilateral organizations
C O M M O N
10%
20%
30%
40%
50%
60%
70%
60.9%
46.6%
34.6%
33.4%
31.4%
27.7%
25.7%
13.4%
12.3%
11.1%
9.7%
9.1%
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
A couple of trends
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
1 – Mid-market heats up
 Major acquisitions: Lionbridge, SDL, L-3
 Minor but important acquisitions in 2005
and early 2006:
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–
–
–
–
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Merrill of Brink
RWS of Eclipse
VistaTEC management buy-out
TransPerfect of Crimson, Epik and Architext
Transware of Global Sight
Welocalize of Connect Global and Transco
SDI Media of Studio
Coto of LingoSystems
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
2 – New Technologies and New Service Models
• Localization as a managed
service (LaMS)
• Technology is “free”
C O M M O N
S E N S E A D V
• Technology rules
• Service becomes cheaper
with technology
• Hybrid solutions – thebigword and
Transware
• Focus on workflow
• Other hosted solutions - Lingotek
I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
¿Donde están la calidad y el branding?
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
Quality: Translator certification
important to 80% of LSPs
Important
36.5%
Not important
16.9%
Very important
43.6%
C O M M O N
Useless
3.0%
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
Quality: Most LSPs have not sought
ISO certification
No
88.0%
Yes
12.0%
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
Branding
– There is no brand if there is no brand awareness
– Recent survey:
•
100 respondents – all buyers
•
289 companies mentioned
•
Top 3: Lionbridge, SDL, and Moravia
– Translation has not had the Keynesian roll-up
– Professional services tend to be balkanized
•
Big accounting houses vs. many small ones
•
Advertising
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
In the time it takes for a typical student
to graduate from college…
Who’s Who in Localization Services?
2005
1.
2.
3.
4.
5.
Berlitz
Bowne
L&H
Lionbridge
ALPNET
C O M M O N
1.
2.
3.
4.
5.
2010
Lionbridge
L-3
SDL
TransPerfect
RWS
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
What do clients really want?
0%
10%
20%
30%
40%
50%
60%
70%
80%
Price
Perceived quality
Test or sample results
Previous relationship
References
Formal corporate criteria
Inherited
Other
Price Displaces Quality as the Main Criterion for Vendor Selection
Question: ”How do you choose your vendors/suppliers?” [multiple answers]
Source: How to Avoid Getting Lost in Translation, Common Sense Advisory, Inc
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.
Thank you.
Renato Beninatto
[email protected]
+1.978.275.0500
Don’t miss
 Localization Maturity Model
 TMS Report
 Global Watchtower
Insight for global market leader
C O M M O N
S E N S E A D V I S O R Y, I N C.
Copyright © 2006 by Common Sense Advisory, Inc.