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I think the most fundamental question facing documentation groups is: semantic-based content or formatting-based content (or XML versus desktop publishing)? The vast majority of traditional documentation systems are format-based, not semantic-based (other than older SGML systems).
With XML, you move away from formatting altogether and focus on content semantics, which provides great automation via XSLT to various outputs, such as HTML and PDF. Need a new output for the latest, greatest help engine? Design a new XSL transform and leave the content alone.
I've used XML with very large documents 1,500+ pages and large topic counts 20,000+ with greatly reduced translation costs. The globalization consultants I've met representing translation interests have all recommended XML for source content. An increasing number of content management systems are also geared to XML.
It helps if you have a techie person available to work with output scripting. Scripting and validation can also provide some sophisticated error reports to help with authoring along the way.
If I were working for a growing company, I would look into investing in XML. Most of the conversions I have done involved smaller companies growing larger, encountering along the way scaling, automation, localization, and flexibility problems with their legacy content systems. Most of the conversions I've peformed worked from Word (doc), RTF, RoboHelp, Frame, and HTML sources. It would be easier and ultimately much cheaper to build on XML now then re-architect and convert later.
Most of the big software companies have already moved to XML with more on the way and a number of scientific industries are standardizing on XML vocabularies. XML represents a sea-change based on key business drivers that are not going way, like increased product complexity, supporting multiple markets or platforms, and globalization.
I also second the suggestion to check out DITA. I highly recommend checking into DITA at OASIS and IBM as a growing standard for technical writing. It will get you started on understanding the philosophy and technical infrastructure, which will help you make an informed decision.
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