Lionbridge announced that it booked record revenue of US$419 million, an increase of US$182.6 million over 2005. Following generally accepted accounting principles, Lionbridge posted a net loss for the year of US$4.8 million. This is the first full year that the company reported financials after acquiring Bowne Global Solutions.

The company is pumping up its Freeway solution and showcasing adoption by focusing on the number of registered users (10,000) and the number of words being processed. CMO Kevin Bolen told us that monthly word volumes have increased 4 times (35 million in January 2007 versus 9 million a year earlier), an estimated 2 billion words are now managed in Logoport translation memories, and project volumes have been doubling every month since August.

But the reality is that clients are still struggling with the idea of moving to a single LSP even if its technology is free and reliable and its scale that of Lionbridge’s. Go figure! Investors, meanwhile, want to know why margins are so low and shrinking. Lionbridge says that once the integration of all Bowne operations is complete, the numbers will show. That is one of the reasons that CEO Rory Cowan will spend a month in Europe, following the path of Microsoft’s Steve Ballmer (pre-CEO) in getting a feeling for in-market issues just by sitting there.

• Challenges: Investors want to see margins go up from the low to mid thirties to levels like SDL’s 49% in 2006.

• Opportunities: Even though the number of mid-size players is small. Lionbridge could still acquire a company like Welocalize or Translations.com and get an inch closer to the stated goal of US$1 billion in revenue.

Finally, on another note, we revisit the question of the 2.0 suffix. Worried that it might acquire the hackneyed and facile stature of "lost in translation," we recently bemoaned the emerging trend of suffixing "2.0" to everything dealing with language. In our sweeping denunciation, we didn’t acknowledge that one of our alleged marketing miscreants, Lionbridge, had been the first company to employ the 2.0 moniker. To be fair, Lionbridge described Localization 2.0 in print and at language industry conferences. Lionbridge’s Bolen agreed with us that Localization 2.0 is meaningless "outside" the industry, which is why "Lionbridge presented the term only in industry trades where the shift would be most poignant and understood. Our mainstream media focus was always on localization as a managed service. Until we introduced this a year ago, you heard nothing in the loc magazines or marketing materials about ‘SaaS,’ ‘localization as a managed service,’ or ‘communities of translators.’" Thus, kudos to Lionbridge for first use of 2.0 in the localization space. We award the Lobachevsky Award to all others.