INK Acquired By R.R. Donnelley

A major translation network has cast its lot in with the world’s largest printing company. What’s in it for each of them?

R.R. Donnelley and Sons, the world’s largest printing company, has acquired a majority interest in INK International, a European translation and localization network based in Amsterdam. While it will continue operating under its own name, INK is now formally a part of R.R. Donnelley’s Documentation Services, the leading supplier of printing and duplication services to the computer industry. With INK, R.R. Donnelley will now be able to add translation and localization to the wide range of services it offers its customers, thereby further tightening this particular end of the production loop and improving its market leverage. R.R. Donnelley is good for US$ 400 million of the estimated US$ 1 billion dollar market for hard- and software packaging.
    For INK, the new alliance is an important breakthrough, and the company’s good fortune is perhaps best symbolized by the empty double magnum of Moët & Chandon standing on an office cabinet someone’s eloquent souvenir. LINKing arms with R.R. Donnelley will provide INK with direct access to R.R. Donnelley’s many large customers in the computer industry a sector INK has long targeted and served. Believing that large companies prefer to deal with large service suppliers, Simon Andriesen and Jaap van der Meer established INK in 1980 and quickly evolved a “corporate” approach to translation. This meant establishing a hierarchy of managing directors, project managers, and editors and working as much as possible with in-house translators to provide the necessary continuity for large projects. INK also strove to provide the necessary technical infrastructure, including the now prerequisite word-processing and dtp facilities. Through much of the 1980s, INK enjoyed tremendous growth, partly because it hitched its horse to the rising stars of flourishing American software houses, like Lotus and SPC, while it also was able to address the substantial requirements of established giants, like IBM and DEC.

Who is making money?
However, in some ways the translation world has stubbornly resisted being transformed into a corporate culture. It has been, and very much remains, a cottage industry, albeit on an enor mous scale. Partly because it is an uncertified activity anyone can call themselves a translator no one really knows how many translators there are in the world and how much the business is worth. One thing seems certain: measured in turnover and/or number of translators, three of the largest translation networks in the world, INK International, Berlitz, and Alpnet, represent significantly less than a percentage point of the world’s total. All three of these organizations have been striving in various ways to address corporate translation requirements; none of them has succeeded in becoming solidly profitable.
    The medium-size translation companies, which have stuck with the old-fashioned formula freelance translators and a low managerial overhead seem to be the only translation companies which are financially healthy. When the computer industry was hit by a widespread malaise several years back, these smaller companies, by virtue of being more nimble and flexible, slowly began to chip away at INK’s marketshare. Or, to put it another way, the computer companies went shopping. For Jaap van der Meer, the crux of the problem has been: How you give added value to services to win customer loyalty? And how much of the costs of those services can you charge them in return?
    Clearly, van der Meer has also been fascinated by translation technology but also disappointed by it. Looking back, he says, “In the mid-1980s, we thought a lot more would be possible with computers, that technology would help us get a higher return on the eighty-thousand guilders a year each translator costs us in total. But CAT and MT they’re not there yet.” Back in 1984, INK was the first Dutch company to license the alps software, and although it never was able to use it, it gave the company the idea of developing its own translation software, the INK TextTools. INK also launched Language Technology (later renamed Electric Word), a magazine which focused on the emerging language technologies and a whole lot more. Although a brilliant marketing move, lt/ew was financially seen a dubious undertaking for a translation company. INK eventually sold the magazine to a Dutch publisher.

Firm about software
Van der Meer dismisses, however, the idea that the company has ever wavered about software. “We’ve been ambivalent about marketing software yes,” he says, “but never about using it or our own in-house development efforts.” Even when INK has had to let experienced translators and editors go, it has continued to maintain its development efforts, currently a minimal one and a half fulltime positions.
    With Donnelley, INK has a partner strongly commited to information technology, and van der Meer says INK will now step up its efforts to develop its next generation of translation software. Sadder but wiser, the company this time will not venture into the open market with its software but rather will keep it in-house and try to turn it into a competitive advantage. Although van der Meer remains reticent about specific details, he suggests that enhancements to the kind of term extraction facilities available with the earlier TextTools texan program might be a useful way forward. Time will tell if INK’s software gamble will pay off.
    Andriesen is confident that the R.R. Donnelley ties will result in a boost of twenty to thirty percent in sales this year, but that will take some effort. Much of Andriesen’s agenda for the coming year will be filled with trips to the us, where he will be explaining to Documentation Services’ staff of eighty salespeople the ins and outs of translation and will be meeting with customers.
    INK has vision; it now has muscle. Will the company also be able to muster up the managerial skills it needs to recast the translation business in a modern mold?

INK International, Baarsjesweg 224 Amsterdam 1058 AA, The Netherlands Tel +31 20 616 4591, Fax +31 20 616 385