Are bad translators driving out the good?

Luigi Muzii and Sir Thomas Gresham

Many of us have a sense of unease from what seem like conflicting signals from the translation marketplace. On the one hand, the demand for translation appears to be increasing worldwide, but on the other, prices appear to be dropping or at least are stagnant [1].

Most pundits agree that there is significant “price compression” in the translation industry. Many translators wonder if advances in machine translation or global economic troubles are to blame. I talked to a man who rejects these beliefs. He has plenty of strong views on the subject, and considers himself to be somewhat of a “contrarian” often with a lone voice on the important issues.

This is Luigi Muzii… AKA “il barbaro” [2].

Although he concedes that he never had any great yearnings to be a translator, Luigi has spent the last 30 years right in the midst of it—translator, terminologist, teacher and entrepreneur. This is what he has to say…

Paul: When you talk about the state of the translation industry, I note that you frequently refer to Gresham’s law [3]. Who was Gresham, and what is this law?

Luigi: Sir Thomas Gresham was an English merchant and financier who worked for King Edward VI and his half-sisters, Queens Mary I and Elizabeth I. He observed that coins which contained the highest quantity of gold or silver would quickly disappear from circulation. As long as these “good” coins had the same face value as the “bad” ones, people would hoard them or melt them down allowing the less valuable ones to flood into circulation.

On the basis of this observation, in 1857 a Scottish economist, Henry Dunning Macleod [4], coined the term “Gresham’s Law”—an economic principle commonly stated as: Bad money drives out good.

Paul: Do you think that this principle is in operation in the translation industry?

Luigi: Most certainly. My observation is that the bad translators drive out the good ones. To understand why and how this happens, we have to understand some of the structural problems which cause so much pain in the industry.

Paul: So how would you describe the industry’s most pressing pain point?

Luigi: The most damaging problem is that the main parameter in selling/buying translation is price–and usually price alone. Rather than looking to understand and meet their customers’ real needs, language service providers find themselves trapped in a downward spiral of destructive price competition. The effects are passed down the line affecting all players in the industry. The damage is made worse when professional translation services are auctioned via portals like ProZ and TranslatorsCafe. Projects are offered to a large, undifferentiated mass of translators and those who offer the lowest bids generally win the tender and get the work.

Paul: So, how does this sort of price compression “drive out” good translation resources replacing them with worse ones?

Luigi: The industry is dominated by a large number of vendors who often add little or no value to the services they buy in from linguists. These resellers typically compete against each other, not on the basis of skill or efficiency, but on the basis of price. This outsourcing and reselling approach is an obsolete and inefficient business model in my opinion.

To survive and withstand price competition in the market, resellers who are unable to improve or streamline their processes find they have no choice but to put pressure on the rates they pay to their translators. This approach marginalises the best translators who become increasingly unwilling to work for such poor rewards and the net effect is that they are eventually squeezed out of the market.

When good, professional translators have the same “face value” as amateurs or moonlighters, we see the application of Gresham’s law in full force. But it’s not just translators–it applies to translation tools, production methods and other translation resources too!

This process has begun to backfire on both the customer and the middlemen who perpetuate this obsolete system. The unprecedented growth in demand for translation in tandem with the effect of Gresham’s Law will lead inexorably to a chronic shortfall of qualified language specialists. The gap between the lower and the higher end of the translation labour market is widening and the process will inevitably continue.

Paul: Is there any real evidence for a shrinking supply of “good” translators?

Luigi: For the past six years CSA have conducted a regular business confidence survey of translation players. In every quarter since they began conducting the survey, LSPs have increasingly complained about not being able to find enough qualified language specialists to meet their needs. [5]

Paul: A diminishing workforce of trained and experienced professionals available to LSPs suggests a crisis ahead for the industry. Do you foresee a collapse of the existing system?

Luigi: When asked to foresee the future, Renato Beninatto prompted me to think of a statement from Wacker and Taylor’s The Visionary’s Handbook [6] which says “The closer your vision gets to a provable future, the more you are simply describing the present”. A similar sentiment was expressed by John Maynard Keynes’s who said “The long run is a misleading guide to current affairs. In the long run we are all dead.” [7]

That’s why I like to see myself as an observer and analyst rather than a visionary or a diviner.

Nevertheless, I have long been warning that the translation industry’s typical business model is obsolete and ineffective. Price competition has undermined the very foundations of the whole system. Reducing staff is impractical in an industry almost entirely based on outsourcing and freelancing, therefore price competition can be only be sustained by cutting direct costs. Generally this can be pursued only through lowering the rates paid to translators and using—but not investing in—technology. And this takes us back to the vicious circle implied in Gresham’s Law.

Paul: Do you think that new, more efficient business models will emerge as a result of this evolving crisis?

Luigi: The demand for translation has been increasing steadily over the last three decades due to the explosion of content made possible by information technology. This growth will continue—and this is no prediction! Content is doubling every year and this growth is outstripping the rate at which translators are entering the profession: it takes many years to create a professional translator. The only way to handle this growth in content is by increasing translators’ productivity, but the translation industry remains a relatively low-tech industry where the “do more with less” philosophy is an imperative that very few can (or are willing) to follow.

In the immediate future I see the translation industry remaining highly fragmented with an even larger concentration of the volume of business in the hands of a bunch of multi-language vendors (MLVs) who hire translators from the lower layer of the resource market to keep competing on price. This side of the industry will soon count for more than a half of the pie. The other side will be made up of tiny local boutique firms and tech-savvy translator pools making use of cutting-edge collaborative tools.

Translation is rapidly shifting online and the costs associated with the online economy are trending toward zero at a very fast pace. The prevailing model will be “freeconomics” where basic services are offered for free, while advanced or special features are charged at a premium. The future is in disintermediation and collaboration.

Paul: What’s the take-away for translators, Luigi?

Luigi: The winners will be those translators who can leverage their specialist linguistic skills by increasing their productivity with advances in technology. These are the ones who may ultimately escape Gresham’s iron law.


[1] Translation Prices – Up, Down, or Unchanged?, Donald A. DePalma, Common Sense Advisory, July, 2012.

[2] Luigi Muzii (“the barbarian”) – brief biographies can be found here and here

[3] Gresham’s Law’s_law

[4] Henry Dunning Macleod: see

[5] Translation Demand-Supply Mismatch, Donald A. DePalma, Common Sense Advisory, May 2012.

[6] The Visionary’s Handbook: Nine Paradoxes That Will Shape the Future of Your Business (2000), Watts Wacker, Jim Taylor and Howard Means, HarperBusiness.

[7] A Tract on Monetary Reform (1923), John Maynard Keynes

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31 Responses to Are bad translators driving out the good?

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  4. Although I would disagree with the author on a few points, particularly those touching on the subject of translation technology, the article is truly one of the best in terms of accuracy and analysis that I have read in a very long time. Regrettably, the author’s words and attendant wisdom will for the most part fall on deaf ears and blind eyes, and this, for many of the very reasons he cites. Nonetheless, the article should be required reading for anyone contemplating a career in the translation industry, particularly the industrial segment thereof.

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  7. I think the author indeed does have a point and the overall description of the “race to the bottom” in translation industry is unfortunately quite accurate. However, I don’t see technology as the main differentiator between the translators who “survive” and the translators who are forced out of the market or become underemployed. The other side of Gresham’s coin in this case is that technology is hitting the less qualified end of the translation industry more heavily, with tools such as Google translate developing to the point that they can be used in non-critical communication where accuracy or style are not of paramount importance. Experts who specialize in a few chosen areas where sub-par work simply wont do will still find adequate bread in translation, although butter might be scarce at times. My personal approach is to take a few good authors to translate for fun and a few technical areas where to translate for profit, and where expertise and quality can not be bluffed.

  8. Peter Kahl says:

    Interesting article, but hardly a “lone voice” or “contrarian”. I have been a freelance translator for 20 years now and in that time I haven’t met many colleagues who don’t sing from the same hymn sheet.
    And Luigi’s summary of “The winners will be those translators who can leverage their specialist linguistic skills by increasing their productivity with advances in technology” is not exactly a revolutionary insight either, is it? In other words, good translators with specialist knowledge who are handy with CAT tools will probably continue to be in demand. Well, well…
    What I would have liked to hear more about is how he sees the dynamic of the market developing. If we accept the premise (and I do) that there is a lot of “bad translation” out there because volumes are increasing and companies tend to go for the cheapest option, then what consequences will this have? Will consumers care or will they accept it? Will good translation develop into a differentiation factor in the same way that in-country call centers have done for banks recently, or does hardly anybody actually read the stuff that companies put out? What do you think, Luigi?

    • Luigi says he has ca. 30 years in the business and you say that you have 20. OK, that’s a combined 50 years. I have 53 years (yeah, you read that correctly, 53), so I guess I outrank both of you. But this is not about outranking. It is about this (foolish) “good” translation vs. “bad” translation, a theme or a song or a tune that I’ve heard since my infant days in the business, and well long before technology was a factor in the “goodness” or “badness” of translation. This argument about “good” translation vs. “bad” translation and how it affects the marketplace is not only ancient, it is to my way of thinking silly (my real inclination is to say “stupid”). To speak of “bad” and :”good” in translation is like trying to eat Jell-O with a fork, but to speak of “good” and “bad” in translation and tie those terms into economics is, well …(I’ll let you read my mind as to what the rest of my thought is). No, on the contrary, there are some very concrete reasons behind the condition of today’s (industrial) translation industry, reasons that you can stick your fork into, and technology ain’t one of ’em. I have written oodles on this subject, but with the exception of a few attentive ears, the deaf ears and blind eyes won the day. Yes, there was a time, particularly in the U.S. and western Europe when individual or independent translators could make a respectably decent living (and that went for both “good” translators and “bad” translators). Repeat: a respectably decent living, but never a living that would allow for a luxurious lifestyle. Today, a decent living in the translation industry is manifestly impossible, universally-speaking. Why? I think it’s best that we leave that for the next chapter, le cas échéant.

      • Peter Kahl says:

        Congratulations and respect for 53 years in the industry, Bernie. Nevertheless, I have a bit of difficulty in grasping the point you’re trying to make. As far as I can ascertain, it could roughly be summarised as “Things aren’t as they used to be”, right?
        A heartfelt sentiment and not one that I would disagree with. However, my question really was how we can react to the fact that things are different now from 10, 20, 30 years ago.

      • Actually, condolences and not congratulations would be more appropriate! And my apologies for the cryptic nature of my first response to you. It was deliberate! OK, you write <> I believe one way that we can react is by facing one very stark and brutal fact in our industry, namely that the suppliers do not set the price for the services they provide. The buyers do. And that makes our little world somewhat topsy-turvy. You see, Peter, in most of the economic world, the consumer pays what the supplier demands. But in the three-tier world of the (industrial) translation industry, and particularly between tiers two and three, but certainly without prejudice to tiers one and two, we have a situation, a clear situation in which the consumer dictates the price to the supplier. As long as that topsy-turvy, economically-anomalous situation is not reacted to, we shall continue to be faced with an ever-downward spiral in compensation, and of course the elimination of the more skilled, experienced and knowledgeable practitioner.

      • Peter Kahl says:

        Sorry Bernie, but I said nothing of the sort. In fact, I believe (like most people) that it is the laws of supply and demand which determine market price, not consumers or suppliers per se. If a commodity is in short supply and it is desired by many, its price will rise. If it is in plentiful supply and consumers (translation buyers) have a wide choice of suppliers (translators/agencies), then its price will fall.
        This is not in debate – what I’m interested in is exploring whether any reaction from the end customers (e.g. the people in Germany who have bought a gadget, the manual for which was translated from English into German in China) will actually buy a different product the next time because they were so unhappy about the experience or whether they will simply put up with it because they got the product for such a good price,
        Look forward to hearing your thoughts…

      • Peter, I apologize once again for the misunderstanding. Somehow, my previous message to you became garbled, in that my quoting of something you said was eliminated.

        My message in the part in question should have looked like this: “OK, you write ‘However, my question really was how we can react to the fact that things are different now from 10, 20, 30 years ago.?’

        In response to that question, I wrote, “I believe one way that we can react is by facing one very stark and brutal fact in our industry, namely that the suppliers do not set the price for the services they provide”.

        The way the message ended up on your screen (because of the omission of your quote), it appeared as if I was “blaming” you for something I myself said. Sorry for all of this confusion.

        I regret that I cannot help you with exploring the issue that you want to explore, namely “whether any reaction from the end customers (e.g. the people in Germany who have bought a gadget, the manual for which was translated from English into German in China) will actually buy a different product the next time because they were so unhappy about the experience or whether they will simply put up with it because they got the product for such a good price”, since that is an issue that is beyond my expertise. And it is also an aspect that in my considered opinion has little if any bearing upon the overall economics of the translation industry, say nothing of the fact that it is somewhat remote from what Luigi was attempting to tell us.

        Unless I have totally misread and/or misunderstood the groaning and moaning, it appears to me that the question that practitioners (or at least some of the practitioners) of our industry are asking is why and how have we come to a point where translation prices (i.e., rates, fees) have dropped so dramatically in the past decade in certain parts of the globe, so much so that those prices have reached 1960-70 levels, and in certain cases 1950 levels. Is it purely a case of supply and demand? From the way I read Luigi, he doesn’t seem to think so.

        Yes, pure supply and demand has played a role in this dramatic drop in prices, along with globalization, and to a limited extent, technology. But if we are to examine supply and demand, my money says we have to focus on the supply side (if we are going to find any answers to the moaning-and-groaning), which in the translation industry has some very unique characteristics, characteristics that were around 10, 20, 30, 40 and even 50 years ago, but have in the past decade become accentuated to the point where they are driving the machinery of price-setting . Luigi did touch (only touch) upon this subject, and it deals with what I call Tiers 2 and 3 of our industry’s supply machinery, in which Tier 2 is the translation agency segment and Tier 3 is the independent translator segment.

        To be continued (perhaps!)

  9. I believe this is what “Anthony Pym calls “adverse selection”. The good ones leave the marketplace.

  10. This is bizarre. I too have 20+ years of experience. I have no singular specialization, and I do not use TM. I have never dropped my rates, indeed I raise them at regular intervals, and still I have no problem finding more than enough work. I have colleagues in a similar situation. Conversely, I know several cheap translators (in the same languages and location) who are finding it hard to get enough work. Perhaps the market we work in somehow differs from the markets of the other commentators above? My point is merely that the scenario described should not be assumed to be universal.

    • One of the great shortcomings, or failings if you will of the translation industry is that there is a dearth of reliable economic data, a situation that is somewhat compounded by the fact that the industry is also absent a history, at least a contemporary one that we can use to make comparisons. On top of that, the very nature of the industry is truly spatial in scope, which often makes for commentaries that reflect a sparrow’s vision. In other words, many translators see the vast and spatial universe of translation solely from their desks or work stations, such as for example some of the statements made by Ben Jones (“I have never dropped my rates…I have no problem finding more than enough work…”). Notwithstanding the aforementioned absence of objective and reliable economic data, most of us who have been in the business for a reasonable length of time have witnessed a marked and undeniable drop in translation compensation, and this, at both the agency and independent translator level. Even in the absence of verifiable economic data, there is more than sufficient evidence to support the claim that generally speaking the fees, rates and prices charged for translation services in 2012 reflect those charged 20 to 50 years ago. Yes, there are no doubt many exceptions, but overall the rule remains what Luigi stated in his article-interview.

      • Ben Jones says:

        Perhaps my comment did appear to be have been made from a sparrow’s viewpoint, as I did not supply references (I did not consider them necessary). But sweeping generalizations such as “many of us have a sense of… most pundits agree… many translators wonder… the main parameter in selling/buying translation is price… most of us who have been in the business for a reasonable length of time have witnessed…” etc. are simply not borne out by my experience, nor that of the numerous professional colleagues with whom I regularly discuss such matters.

        I am not observing things solely from my desk: my opinion is based (inter alia) on verifiable economic data such as the surveys conducted by the Institute of Translation and Interpreting and (in more detail) by the ITI Japanese Network, over significant periods of time, as well as frequent discussions with other translators and interpreters as well as translation agency staff and managers. The insights gained from these surveys / interactions etc. will naturally be biased a certain extent towards the UK, or towards qualified translators working in the Japanese-English language pair; hence you might justly claim that the only valid conclusion I can draw is e.g. that accredited technical J/E translators in the UK have not experienced a drop in rates, while non-accredited translators with less experience and (often although not necessarily always) lower quality frequently report problems finding work (e.g. as has been observed within our professional association).

        Portals such as ProZ may indeed contribute to more competition and hence a lowering of rates in that particular domain, and this may drive better translators away from that domain, but I believe the better translators are driven away into the domain where clients are more interested in quality than price. If you are a good translator, this is not a bad thing. I am happy for clients who want cheap translations (whatever the quality) to seek the cheapest they can find via such portals. Clients who value top quality work and are prepared to pay for it do not trust such routes. As Luigi says, “LSPs [complain] about not being able to find enough *qualified* language specialists” – exactly, many of the good people cannot be found by such portals, and I know several who would not even consider accepting work from the best-known MLVs. This does not, however, mean that these people have left the industry.

        If there is a crisis of this nature, it may be that of qualified *public service interpreters* (in the UK for sure, but also apparently in various other areas), who are apparently leaving the industry altogether due to the extreme drop in rates caused by the government awarding a monopoly to a single private contractor (again, this is the case in the UK but the situation is different elsewhere). The process is not complete, though, as many of the PSIs are still fighting their corner and trying to get the Ministry of Justice to scrap the framework agreement which gave rise to this problem. Hence there is still a chance that these qualified, quality linguists will remain in the industry.

      • I am truly, truly reluctant to get into a personal spat with Mr. Jones, and accordingly will allow the community to determine whether he is one of many observers of and commentators on the international (industrial) translation world who regrettably succumb to viewing that world from their proverbial and non-proverbial desks. And to assist in that determination, allow me to quote Mr. Jones’ very own words about his view of what is undeniably a vast and endless universe.

        a) “Perhaps my comment did appear to be have been made from a sparrow’s viewpoint, as I did not supply references (I did not consider them necessary).”

        b) “I am not observing things solely from my desk: my opinion is based … on VERIFIABLE [sic] economic data such as the surveys conducted by the Institute of Translation and Interpreting and … by the ITI JAPANESE Network, over significant periods of time, as well as frequent DISCUSSIONS with other translators and interpreters as well as translation agency staff and managers” (capitalization added)

        c) “The insights gained from these surveys / INTERACTIONS etc. will naturally BE BIASED A CERTAIN EXTENT TOWARDS THE UK, or towards qualified translators working in the JAPANESE-ENGLISH LANGUAGE PAIR; hence you might JUSTLY CLAIM THAT THE ONLY VALID CONCLUSION I CAN DRAW IS e.g.. THAT ACCREDITED TECHNICAL J/E TRANSLATORS IN THE UK HAVE NOT EXPERIENCED A DROP IN RATES ..” (capitalization added)

        Indeed, perhaps I have been misinformed (as Mr. Blaine of “Casablanca” opined), but the Japanese-English combination in the vast universe of translation might be called a niche, or if you will a niche market. Furthermore, my understanding is that the U.K., as major and significant as the nation is, is still only one nation in the world community of nations.

        Oh, yes, one final point. I received Luigi’s original article-interview through an organization called “No Peanuts”, an organization that was ostensibly established for one purpose, namely, to fight the ever-growing downward spiral of prices for professional translation services throughout the world. I would think that an organization like “No Peanuts” would have never been born had the translation industry – and particularly its independent translator segment – been experiencing universal economic growth and prosperity.

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  14. Jaroslaw Michalak says:

    What exactly do you mean by “driving out the best translators”? Do they change profession? Why would they – even if the rates stall (or fall), they are still the best paid in the industry? Do they starve to death? I do not think so…
    I believe the number of the best translators is roughly the same as always. There is really no mechanism or pressure to produce more (LSPs do not have graduate programs at the universities… yet), besides we have to take into account natural predispositions (we cannot grow more genius linguists on demand, can we?).
    At the same time, as you said yourself, the volume of content increases dramatically. To serve it, the profession has to admit many more translators, so the _average_ skill level naturally goes down, along with the rates. While most of the “new” content is itself of mediocre quality (so, economically, it does not _require_ best translators), the volume of the “top” content grows as well, so the demand for the best translators increases. In other words, the best translators are not “driven out” – how could they be, if they are more needed than ever?

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  18. Can’t agree more with the author. Recently feel an on-going pressure from my clients (LSPs) for rates reduction. Luckily, I have some direct clients and few “boutique firms” that keep me afloat.

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  22. Heather says:

    “Are bad translators driving out the good? | The translation business” was a incredibly great posting,
    . Continue posting and I am going to continue
    reading through! Thanks for the post ,Karry

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