"Most state-of-the-art commercial machine translation systems in use today have been developed using a rules-based approach and require a lot of work by linguists to define vocabularies and grammars. Several research systems, including ours, take a different approach: we feed the computer with billions of words of text, both monolingual text in the target language, and aligned text consisting of examples of human translations between the languages. We then apply statistical learning techniques to build a translation model," explains Franz Och.
You can compare the new Google Translate with Babel Fish, a site that uses Systran to provide translations. The switch is a sign that Google's system has improved a lot and could soon be ready for expanding its coverage.
{ Thanks, Steve Rubel. }