What I expect for 2012

As the song goes, "it's the most wonderful time of the year". It's the time to make predictions.

Before going into my expectations for 2012, I took a look at what I wrote last year, and I believe that my predictions for 2011 materialized.

Content is indeed being served in smaller chunks and requiring faster turnaround times. There is more demand for multimedia translations such as video, and also for interpretation both on-site and over the phone. So voice was in fact more in demand in 2011.

Last week, LinkedIn announced that their website was now available in Indonesian, Malaysian, and Korean. Several other companies have done the same. Brazilian Portuguese was one of the fastest-growing languages, but also one with the most quality and delivery problems.

What didn't happen at the pace that I expected, was the number of mergers and acquisitions in the industry in 2011. There have been some, but no major mergers.

The topics that I expect to hear about in 2012 are more related to startups. There is going to be an increased focus on on-demand translations. Companies like Speaklike, MyGengo, Smartling, Translated.net, LanguageWire, Tolingo, and OneHourTranslation will be all over the place. Larger players will also offer their own solutions. Companies will be able to find efficiencies in moving down to smaller projects.

I also believe that we are going to be talking about marketplaces again. This sounds so 1999, but companies like Cloudwords and OpenBorder will be offering an online marketplace for translation companies to bid on projects of traditional buyers. Proz tried that before, but who knows... the times are different.

The automation of small project workflows, will require an increased productivity on the part of project managers. The most requested job in the translation industry will actually be project management, but the role of the project manager will shift more rapidly from closely managing resources to managing exceptions.

I don't think that the economy is in shape for many mergers and acquisitions. But we will hear about some of them happening. Companies like Welocalize and Transperfect still have plenty of cash, and there are companies for sale in the market. It is just a matter of finding the right price point.

Italian Leading LSPs Arancho and Ic.Doc Merge

As I predicted a few weeks ago, the consolidation movement in the language industry kicked off early. Today, Roberto Ganzerli and Susan West, respectively CEOs of Arancho and Ic.Doc announced the formation of Arancho Doc srl.

Susan West & Roberto Ganzerli

The new entity will combine the talents of companies that excel in software localization, technical documentation, life sciences, and CMS integration in nine offices in seven countries (Italy, Belgium, Czech Republic, Finland, Japan, Spain, and Switzerland).

Arancho Doc will be run by Roberto Ganzerli (Chief Strategy Officer) and Klaus Haase (COO) and will be headquartered in Bologna. The combined organization has 90 employees and approximately €8.5 million in revenues.

After the successful integration of the Czech LSP Donatello last year, Arancho Doc is now looking to expand into Germany and the United States through strategic mergers or acquisitions.

I always thought that Arancho's unique strategy of growing in peripheral markets was very smart. I loved the fact that the company headquartered in Rimini (Federico Fellini's birthplace) had offices in Barcelona and Helsinki, before venturing into more traditional and highly competitive locations like Brussels and Prague. Now, with the addition of Ic.Doc, the organization adds more cosmopolitan Zurich and Osaka to their list of locations.

Let's see who is next.

What I expect to see in 2011

This is the time of the year when people start making predictions for the next year. Well, as I have already been asked several times what I see in my crystal ball, let me share it with you.

• Content. Let me start with a quote from futurist Ray Kurzweill in a recent interview for Time Magazine: "Our intuition about the future is linear. But the reality of information technology is exponential, and that makes a profound difference. If I take 30 steps linearly, I get to 30. If I take 30 steps exponentially, I get to a billion."
  
  So content is growing exponentially and that's not news, but for the language industry there will be two trends that will accelerate in 2011. First is the atomization or chunking of content, i.e., translation projects will come in smaller sizes (in line with the trend in the software industry to move to apps). Second is velocity of content, i.e. clients will want these projects faster. These two trends will drive increased demand for productivity gains.
• Voice. I believe that there is going to be an increase in demand for voice translation. Not only on-site and over-the-phone interpretation, but also dubbing and subtitling. Everybody talks about the ascendance of video, but video means very little for the translation industry; what needs to be translated is what people say, hence the increase in video will lead to an increase in the demand for voice-based translations. (Note to translators: Learn interpretation skills).
• Languages. Be prepared for increased demand for Indonesian (Indonesia is right after the U.S. in numbers of Facebook users), Vietnamese, and African languages. I also expect increased demand for Brazilian Portuguese as the predictions for growth in the Brazilian economy are very positive.
• Business. Acquisitions will happen. Expect several announcements and some consolidation at the top. The main discussion will be once again the fair valuation of companies. Naturally Welocalize will lead the charge, but I expect to hear from SDL, Moravia, CLS, HiSoft, and the Scandinavian companies like Semantix, AAC, and LanguageWire. Either as aquirers or targets of acquisition.
• Pricing. It is true. Price pressure is really a fact now. Mature clients are shopping around for better prices in order to translate more with the same budget. For many years I have said that prices had been stable in the industry, but I believe that in 2011 companies will succumb to the haggling of the big buyers. The only way out of this is to dramatically increase productivity using technology at levels never seen before. This will be especially important for Single Language Vendors. Freelance translators should think about measuring their income per hour or per month, instead of their price per word.
• The year of interoperability in the cloud. All this talk about privacy and how Google Translate breaches confidentiality clauses will disappear. Translation memories will be shared in the cloud and the chatter of the last two years will become just that; chatter. The big winners in technology will be  the MT solution providers and Kilgray, with its MemoQ technology (that works very well with files generated by their competition and thus achieves de facto interoperability). It is not surprise to me that MemoQ only has raving fans. Asia Online stands a good chance of growing a lot this year as the last stalwart of independent MT. I predict SDL will still grow out of pure momentum, not because of its "innovative" solutions.

What I don't expect to be news in 2011, even though there is going to be a lot of talk about it still, is the adoption of Machine Translation and the impact of Social Media as a source of more translation and localization.

In my opinion, MT crossed the chasm in 2010, and Social Media content is generated almost exclusively in local languages, with very little impact on the demand for translation and localization. Social Media might be a driver, but not demand generator in itself. However, I wouldn't be surprised if a few startups come up with the idea of creating companies focused on localizing Facebook pages and Twitter feeds.

Now I need to catch a plane....