The language industry consists of segments that move at different speeds and have different sizes. Companies that specialize in a fast-growing and sizeable vertical can enjoy a steady increase in business.
For buyers of language services, it makes sense to select a provider with the appropriate portfolio size in their vertical. Those companies will speak the business language and know the challenges of that sector. Also, they will have resources such as specialized translators, translation memories, domain MT engines, glossaries and training materials.
How to read this chart
- The chart includes revenue from all language services, including translation, interpreting, transcription, and media localization. Where possible, we excluded revenue from non-language services such as game testing and user support.
- Our chart groups verticals on three levels. For example:
Regulated > Life Sciences > Medical Devices
- Companies with larger portfolios are positioned closer to the center, while specialists with smaller portfolios have been placed further away from the center.
- The full version of the infographic, which is available to Nimdzi Partners, includes individual company revenues per sector and their estimates.
The chart is based on data obtained via responses to The Nimdzi 100 survey earlier this year and on annual reports of publicly-traded firms such as RWS, SDL, Honyaku center and Keywords Studios. We added estimates in cases where we had reliable third-party information, for example, Nordic interpreting companies that disclose their revenues via online business registries. The resulting sample size is USD 4.6 billion.
Segment leaders generate over USD 100 million in their vertical
Being number one brings a lot of perks. In almost every vertical we looked at, the largest player derived more than USD 100 million from that vertical alone: TransPerfect in Life Sciences and Legal, SDL in IT, Keywords Studios in Games, SDI Media in Media Localization, RWS in Patent, and Canadian Translation Bureau in Public Sector. In almost every vertical there is a huge gap between the number one provider and the rest of the flock.
Top contracts make a colossal difference.
Local markets offer a different distribution
Zooming into regional markets, we find a very different distribution of revenue by sector.
- Medium-sized language service providers (LSPs) in the US receive close to 50 percent of their sales from Public Sector and Healthcare interpreting, the ALC study found in 2019.
- In Russia, technical translations accounted for 30 percent of the volume due to robust demand from the energy and oil and gas enterprises, according to a 2019 study.
- In the UK, key providers derive a high percentage of revenue from eCommerce and travel translations.
- In France, luxury, fashion, wine, and cosmetics translations make a specialized market with premium prices and significant volumes.
- Large Chinese and Japanese providers derive a big portion of their revenues from intellectual property and patent translations.
Countries have specialty areas, and it makes sense to coordinate vertical and geographical expansion strategies to achieve the best sales potential.
Top-100 LSPs focus on verticals with bigger budget concentration
Technical translation may have a huge volume globally, but it is a fragmented market that spreads across hundreds and thousands of LSPs. In the Top-100 distribution of revenue, Media localization is a bigger vertical than Technical, because sales are concentrated. They come from a few top clients, such as the Hollywood studios and Netflix, and capturing this market has propelled leading companies into hundreds of millions of revenue.
Smaller LSPs likely have more revenue in technical translations and general business. These are segments with a lower concentration of business and a higher fragmentation of vendors. They also have revenues from sectors not reflected in the chart, such as retail. Certified translations for private persons exist as a business in every country. However, companies do not come into millions of USD by working in B2C.