Teddy Bengtsson, CEO, Idea Factory Languages, Buenos Aires Argentina in interview to Localization Resource Ireland, said:
"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 capitalize on the opportunities and negate the risks involved in making such substantial acquisitions. As both companies have very strong and capable leadership, I believe they have every chance of making successful and relatively smooth integrations.
In the case of Lionbridge, the significance of scale is a driving factor, and I think it will help them gaining ground particularly in industries looking for complete business process outsourcing. They are also aware of the importance to optimize internal efficiency by using offshoring solutions and expect to see an enhanced focus in this area to offset their substantial infrastructure costs. Key challenges will include to prove to their customer base that scale truly brings value, something which will be particularly pertinent for clients seeing them as a service supplier rather than a strategic business partner (and those are still many), and of course also to make a cohesive entity from two large scale organizations.
SDL clearly sees technology leadership as the way towards corporate success. Adding Trados to their already substantial language technology development team will unquestionably put them in the driving seat in this area. 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 and no doubt SDL has real opportunities to make it successful. No easy task though, as 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 fact that much of their current client base are to some degree competitors of SDL in the language services arena does not make that task any easier.
The big guys getting bigger will open some doors for the not so big ones. In reality, the majority of language buyers neither want nor need full business process outsourcing or enterprise technology solutions. They will continue to look for the most cost effective way of meeting their specific requirements, and the optimal answer may not be a supersized partner. Medium sized MLV's may benefit to some degree for the simple reason that buyers want to have choice and a more personal relationship. Regional or single language vendors even more so as clients look to save costs by going straight to the source, especially those associated to international alliances that today offer attractive alternatives to multilingual vendors."
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