Last December we stared into our crystal-ball-as-a-service software to predict what would happen in 2007. Here’s how we did:
- Translation automation technology and distribution morph. We predicted rapid product turns, innovated distribution, and new market models from smaller firms; increased use and consideration of statistical MT solutions; and newbies would enter the market and challenge the dominant tool and service paradigms. Crystal ball assessment: Goal! The language technology sector really showed some innovation in 2007. Next up for them is figuring how to make money.
- CMS-TMS saddle up some partnerships — again. We predicted continued growth for translation management solutions from Idiom, SDL, and newer entrants. We also said there would be more private-label integrated solutions between TMS and CMS vendors. We also thought there would be more substantive CMS-TMS partnerships. Crystal ball assessment: Growth for TMS certainly happened, but private labels didn’t. Partnerships blossomed, as with Lionbridge’s opened API. And even we were surprised when SDL bought Tridion.
- Vendor management gains visibility. Sourcing translators mostly amounts to maintaining rudimentary databases of professionals. We predicted that this reactive function would benefit from initiatives like the Translator Profile Exchange (TPX). Crystal ball assessment: TPX went nowhere. There was increased awareness of vendor management and some forward movement, but not as much attention as we thought there would be.
- Mash-ups find their tongue. We expected to see some interesting multilingual mash-ups like a directory service tied to Google maps that sends an SMS to interpreters in the vicinity of a courthouse or hospital that needs language help. We also thought Proz and DotSUB might mash up for some pro bono subtitling. Crystal ball assessment: There was a lot of talk about this one, but little delivery except for our primer on how such mash-ups should happen and Google’s translation bots. Score slightly above zero for the home team on this one.
- Private equity expands its role in the language market. We expected to see more investment from the venture firms anxious to spend down their funds. We looked to a roll-up of smaller LSPs or globalization software vendors into a larger, more viable firm. We also blue-skied taking a public language services or technology company like Lionbridge or SDL private, slicing and dicing costs, adding a few smaller acquisitions, and wrapping it up for a new offering in a year or two. Crystal ball assessment: Since July 2006 we’ve had lots of discussions with financiers thinking about entering the market, but no one has thrown the dice yet. They’re still asking.
- Government suppliers eye commercial markets. We thought that a Democratic Congress might have some impact on U.S. foreign policy. Further, we said that government-focused LSPs would look to the commercial market seeking higher margins and a new source of revenue to please shareholders. We predicted success wouldn’t come easy. Crystal ball assessment: Who would have thought a year ago that the U.S. would be spending US$3 billion per week in Iraq and that Congress would be as deadlocked and ineffective as it has been? L-3 did lose the biggest language deal in history, but it continues to appeal. The government suppliers would be out of their minds to change their business models now. Memo to self: “Get Common Sense Advisory certified as a government contractor.”
- India invests in deconstructing the Tower of Babel. We wrote that more and moreore work is being done in India as high-tech vendors like Cisco, EMC, Microsoft, and others build centers of competence there. We said that this shift virtually guarantees that major decisions about product localization will be taken in Asia. As early as 2004, we predicted that Indian companies would enter the language services market. Crystal ball assessment: Cisco now characterizes its Bangalore center as its second headquarters, Wipro has learned from the LSP masters and now exhibits at Localization World, and Indian outsourcing is part of every IT services plan.
- The China card still baffles many. We wrote that North Atlantic translation agencies would continue to buy low-cost production centers in China, but that economics will set the stage for future M&A originating in Asia. We said that you should expect to see Chinese fact-finding missions visit American and European LSPs to learn how to sell translation and produce world-quality output. Crystal ball assessment: Chinese BPO, ITO, and LSP firms are opening offices around the globe (for example, CSoft) or going public on the New York Stock Exchange (VanceInfo, née Worksoft). China is now part of the outsourcing equation for many North Atlantic firms.
Not bad, but not perfect either. Let’s see how well our conjectures for 2008 play out.
