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News > Companies
Vote machine firms smile
November 16, 2000: 4:45 p.m. ET

Voting machine makers foresee strong sales in wake of election woes
By Staff Writer Martha Slud
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NEW YORK (CNNfn) - For years, Andrew Wynham and others have been talking about the antiquated state of U.S. voting equipment. Now, he says, people are starting to listen.

And for his business and others like it, that could be very good news.

Wynham is a customer support manager at Sequoia Pacific Voting Equipment Inc., a Jamestown, N.Y.-based company that makes touchscreen-style machines that allow users to cast their votes in the same way that they use an automatic teller machine. As the vote recounts continue in Florida and the world awaits the outcome of the U.S. presidential election, Wynham says the chaos can only mean more business for suppliers of new types of voting equipment.

"I'm responding to like 100 e-mails a day -- investors on how can they buy stock, calls from the news media, and local governments interested in buying the product," he said. "It's going to be a great year for reputable voting machine companies in America."

Sequoia, a small unit of publicly traded conglomerate Jefferson Smurfit Group (JS: Research, Estimates), owns the now-defunct Automatic Voting Machine Co., which used to manufacture mechanical lever-style voting machines. The lever machines are no longer made, but the firm still refurbishes and services them. The company's primary business now is manufacturing direct recording electronic (DRE) machines that record and tabulate votes simultaneously.

graphicSequoia, along with several of its rivals, also has introduced touchscreen voting systems, which are slowly growing in use. Sequoia's machines were used county-wide on Election Day in Riverside County, Calif. The company installed about 4,200 machines there at a cost of about $14.7 million.

The voting machine business isn't exactly a major U.S. industry. Company officials peg the annual market at anywhere from $150 million to $200 million total -- a modest amount considering that voting machines are needed in every locality throughout the United States. But the machines typically are a tough sell because most jurisdictions take an "if it's not broke, don't fix it," type attitude toward their voting machines, equipment that's used only a few times a year, said Jim Reis Jr., president of Indianapolis-based MicroVote Inc., a direct recording electronic voting equipment supplier.

"Typically when a disaster occurs we get a sale," he said, referring to buying that occurs after voting machines break down or vote counts go awry. "Now we have a greater opportunity, or certainly a greater audience, to tell our story."

Other companies that make advanced voting equipment also said they are anticipating strong interest in their products stemming from this year's close race. They said the coming year already was forecast to be strong, because the year after a presidential race is normally a slow election period and the time when jurisdictions consider upgrading their equipment.

"I'm looking forward to a great year," said John Elliott, chairman of Fidlar Doubleday Inc., of Rock Island, Ill., which produces touchscreen voting technology. "You couldn't ask for a better situation than what we're in."

Slow to modernize

Only about 9 percent of registered voters used direct recording electronic voting systems as of the 1998 election, according to Federal Election Commission data. The rest used lever machines, paper ballots that are scanned optically, or the punch card-style ballots that have been at the heart of the Florida debate.

But while voting machine businesses point to the great need for jurisdictions to improve technology, they admit it can be hard to convince localities that the equipment is really necessary.

"The problem is that when I'm out marketing a voting machine to a county, I'm in line with the guy who is trying to get funding for that cancer wing at the hospital," said Wynham, of Sequoia. "It's very hard to prioritize voting machine systems."

Wynham estimates that it would cost anywhere from $1.5 billion to $3 billion for the entire country to transfer to touchscreen-style voting systems. Others estimate the total at up to $5 billion. At the current rate of spending on voting technology, it would take about 120 years to make the switch, he said.

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  "It's going to be a great year for reputable voting machine companies in America."  
     
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  Andrew Wynham
Sequoia Pacific Voting Equipment
 
But, "post-Florida, that's going to be a different figure," Wynham predicts. If the country spent 99 cents per year on every voter to upgrade voting technology, every locality could transfer to touchscreen systems over the next 15 years, he said.

A number of companies supply the touchscreens used in the new voting technology. One touchscreen maker, MicroTouch Systems Inc. (MTSI: Research, Estimates) of Methuen, Mass., said it sees the voting business as one that's particularly appropriate for the touch technology.

The touchscreen method is "much more intuitive than checking a box," said Timothy Holt, a MicroTouch spokesman. "Touch will solve a lot of problems." The company is being purchased by Minnesota, Mining and Manufacturing (MMM: Research, Estimates) for about $160 million in cash, or about $21 a share.

Meanwhile, the company that produced the punch-card software used to print ballots in Palm Beach County, Fla. -- the eye of the election storm -- says it thinks it may now lose some business because there is a perception that the technology is unreliable. But Paul Nolte, the president of Little Rock, Ark.-based Election Resources Corp., said the systems that are in place in Florida "are almost 100 percent accurate."

"I believe we will probably lose several customers that will probably change to some other voting system in the next couple years," he said. "There are counties that have wanted to change from punch card to some other voting system. I suspect this [Florida situation] will make it possible for those counties to make a move." graphic

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.