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Argentina: the End of the World, or a Distant Localisation Outpost?

Teddy Bengtsson discusses localisation from an Argentinean perspective, and whether the recent industry mergers will have much impact on the fragmented localisation industry there.

Originally published in December 2005 issue of Localisation Focus. To learn more about Localisation Focus, click here.

ANTARCTICA ASIDE, ARGENTINA STRETCHES THE EARTH’S LANDMASS TO ITS SOUTHERNMOST POINT. Perhaps the end of the world in a geographic sense, but is it also a million miles away from what is happening in the world of localisation? The recent big industry mergers have generated a lot of discussion and speculation — but do these have any impact on what is taking place in this peripheral localisation nation?

Idea Factory Languages (IFL) was set up in 2003 to merge industry expertise with the potential of a low cost location, well educated resources, good infrastructure, a convenient time zone, and a strong cultural alignment with Europe and the US. Only one thing missing — a localisation industry…

Whilst recent developments, most significantly the Lionbridge/BGS and SDL/Trados acquisitions, may stir up emotions as well as speculation and concern, I think the industry will continue in ‘business as usual’ mode. The key changes and challenges lie with Lionbridge and SDL themselves to capitalise on the opportunities and negate the risks involved in making such substantial acquisitions. I believe successful and smooth integration should be possible due to the strong leadership of both companies.

For Lionbridge, scale is a driving factor that will help them gain ground, particularly in industries looking for complete business process outsourcing. They are also aware of the importance to optimise internal efficiency by using offshoring solutions and will no doubt expand in this area to offset substantial infrastructure costs. Key challenges will include proving to their customer base that scale truly brings value, and of course also to build a cohesive entity from two large-scale organisations.

Lionbridge uses a substantial network of partners worldwide to deliver language-specific solutions, and I can envisage an even greater focus on these services post-acquisition. They will look to drive process and cost optimisation further and this will require reliable suppliers with a comprehensive service offering. I also expect they will carry out assessments of their internal production centres to establish how to best integrate these with the partner network — which can only have a positive impact on their strong regional suppliers, especially those located in cost competitive environments such as Argentina.

SDL clearly sees technology leadership as the way towards corporate success. Adding Trados to their already substantial language technology development team will unquestionably give them a dominant position. They will look to use this position to sell technology- based enterprise solutions, together with the added benefit of an integrated language service function. A compelling concept but no easy task though — sales cycles to potential clients are likely to be longish and in the meantime they need to assure existing customers that the value proposition to them is not being diluted or compromised. The task is not made any simpler by much of SDL’s current client base being, to some degree, their competition in the language services arena.

In terms of Argentina, SDL’s acquisition of Trados probably won’t have too much of a short-term impact. We are starting to see signs of the tools suppliers taking a higher level of interest in the market place, e.g. through local event attendance. Naturally, any move which serves to help the understanding and development of localisation tools usage is good news for the industry here. The country has lacked strong localisation service companies in the past, and therefore the market is still highly fragmented and consists mainly of freelance translators. The companies that do exist tend to be small, with a network of freelance resources. I think IFL became the country’s largest language services employer after only 4 months in operation! Subsequently, training has been difficult to avail of and driven primarily through individual initiatives. Furthermore, the lack of localised pricing models has further hampered growth in terms of utilisation and expertise. I hope we will see a move towards availability of freely available satellite versions of TM software, as well as smart and affordable solutions for small- to medium-sized vendors, as this would help to progress and develop the local market.

The big guys getting bigger may open some doors for the not so big ones. The majority of language buyers will continue to look for the most cost-effective way of meeting their specific requirements, and the optimal answer may not always be a supersized partner. Mid sized MLV's may benefit — buyers want choice and a more personal relationship — and regional or single language vendors even more so as clients look to save costs. They will do this by going straight to the source — either by working directly with regional or single language vendors or using international alliances that today offer viable alternatives to multilingual vendors.

From the distant localisation outpost of Argentina, IFL will of course closely watch what happens as a result of industry mergers and acquisitions. Still, we will continue to focus our efforts on doing what we set out to do, i.e. to raise the bar for language service suppliers in Latin America and to provide added value for our clients — both direct customers and multilingual vendors around the globe!

Teddy Bengtsson has over 20 years experience in the IT industry. He is currently CEO and founding partner of Buenos Aires-based Idea Factory Languages. Before starting IFL, Teddy held the position of Director of Vendor & Language Services at Oracle Corporation, and previously held management positions with Microsoft Corporation and Aldus Europe Limited. He can be contacted at teddy.bengtsson@NOSPAMidea-factory.net (remove NOSPAM to email).