Translation and Interpretation Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 2,500 translation and interpretation service providers in the US translate written material, interpret speech from one language to another, and offer sign language services. Specific services include localization (adapting digital content for a specific market), transcription, subtitling, voiceover/dubbing, and language testing or training.
Dependence on a Highly Skilled Workforce
Translation and interpretation agencies and companies rely on highly skilled workers to provide services.
Industry size & Structure
The average translation and interpretation service provider operates out of a single location, employs about 14-15 workers, and generates $2 million annually.
- The US translation and interpretation services industry consists of 2,500 firms that employ 37,800 workers and generate about $5 billion annually.
- The global language service provider (LSP) industry is estimated to be worth about $52 billion, according to CSA Research.
- The industry is concentrated at the top; the top 50 companies account for 68% of industry revenue.
- Types of companies include multi-national firms, language technology firms, local agencies and freelance interpreters and translators.
- Large firms include TransPerfect, Lionbridge, and LanguageLine Solutions (Teleperformance).
Industry Forecast
Translation and Interpretation Services Industry Growth
Recent Developments
Mar 16, 2023 - M&A Drives Language Industry Growth
- Merger and acquisition (M&A) activity was a significant driver of revenue growth for language service providers in 2022, according to the 2023 edition of the Language Service Provider Index (LSPI) by language industry news and data firm Slator. The LSPI includes about 350 language service provider (LSP) firms, categorized by size: Super Agencies (revenue of more than $200 million), Leaders (more than $25 million but less than $200 million), Challengers (between $8 and $25 million), and Boutiques (between $1 and $8 million). The combined revenue for all firms in the 2023 LSPI was nearly $10.4 billion, up about 10% from 2021, but much of the rise was due to industry consolidation rather than organic growth. In terms of both M&A and organic growth, Leaders posted the biggest gain in 2022 with a revenue increase of 16%, followed by Super Agencies (6.5%), Boutiques (5.4%), and Challengers (3.2%).
- In January, Chinese tech firm Tencent conducted tests to determine if the advanced AI chatbot ChatGBT can perform as well as commercial machine translation (MT) tools such as Google Translate, Deepl, and Tencent’s MT offering, according to language industry news and data firm Slator, The study found that while ChatGBT performed “competitively” with more established MT products on high-resource European languages, it was less adept with low-resource-languages and unrelated language pairings. For example, while ChatGBT did well in translating English-German, it did less well in translating English to Chinese. Overall, Deepl and Google Translate outperformed ChatGBT on two of three tests Tencent conducted (translating Medline abstracts and Reddit comments), but ChatGBT “significantly” outperformed Deepl and Google Translate on the third test (translating a crowdsourced speech recognition corpus).
- Most language professionals are optimistic about their business outlook for 2023, according to Slator, a language industry news and data firm. About 49% of respondents said they were “cautiously optimistic” about business in 2023, and 21.6% reported being “very positive.” Equal percentages – 11.8% - were “neutral” and “somewhat negative.” Nearly 6% of those surveyed were “very negative.” Slator’s survey also asked readers how “big of a deal” Open AI’s ChatGPT is. ChatGPT can generate human-like text and be used for language processing tasks, including translation. More than 37% of Slator readers surveyed said ChatGPT is a “very big deal,” while nearly 32% said it “seems important.” Almost 17% replied that they “will probably check it out,” and about 14% said ChatGPT is “total hype.”
- Professional interpretation services have been shown to improve healthcare outcomes for patients with limited English proficiency (LEP) but are often underutilized. A retrospective chart review of all patients who visited the Ontario, Canada, Kingston Health Sciences Centre’s emergency department and urgent care center was conducted to determine the demographic and visit information of LEP patients who did or did not use the LanguageLine interpreting and translation service. Less than 1% of LEP patients accessed LanguageLine. Those who did were more likely to have been younger, had a more acute illness, and spoke Arabic. Most emergency department physicians were either unaware of or not accessing LanguageLine despite seeing LEP patients.
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