The Microsoft Research Machine Translation system (MSR-MT) is actually a hybrid system, using both rules and statistical methods (1) .
According to Peter Norvig (2) (emphasis mine):
Machine translation: 100% of top competitors in competitions such as NIST use statistical methods. Some commercial systems use a hybrid of trained and rule-based approaches. Of the 4000 language pairs covered by machine translation systems, a statistical system is by far the best for every pair except Japanese-English, where the top statistical system is roughly equal to the top hybrid system.
Is this because Japanese is a very regular language (agglutinative), which makes it easier to use rules? Or is it only because of sociopolitical reasons (Microsoft had some sort of relationship with Japanese people, etc.)? If the first, why aren't other agglutinative languages (Turkish, Korean) also using statistical/rules hybrid systems?