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   Strategies & Market TrendsVoting Machine Companies

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To: NotNeiderhoffer who wrote (30)11/19/2000 7:07:05 PM
From: levy
   of 69
Presidential Race Brings Attention
To the Business of Voting Machines


Get ready for another post-election scramble -- this time by officials searching for more accurate vote counts and voting-machine vendors looking for new business.

Around the country, local election officials are talking about scrapping old systems and switching to new, more accurate ways of tallying the vote. In Georgia this week, Fulton County's elections chief announced that she was trading in punch-card ballots -- similar to those used in the dispute over presidential voting in Palm Beach, Fla. -- for an optical-scan system.

Though local governments are notoriously pinched for money, help might be on the way. This week, Sen. Charles Schumer, a New York Democrat, proposed legislation that would call for the Federal Elections Commission to establish guidelines for modernizing elections and make $250 million available to state and local governments to buy new equipment. Lawmakers in individual states also have talked about providing more money to municipalities.
See a table illustrating the different types of voting machines

Punch-card voting, however, isn't likely to get their support. Even though it was the most widely used voting method in 1998, it already was seen as a shrinking business. Larger companies have focused more on selling optical-scan systems over the past decade and left the punch-card business to smaller competitors.

Optical-scan systems, which require voters to fill in an oval or connect an arrow with a pen, have replaced many punch-card systems, although primarily in smaller jurisdictions. The other fast-growing alternative is electronic-voting machines, which automatically record a voter's selection from the touch of a button. Electronic units usually resemble an automatic-teller machine or employ a touch screen.

Jim Ries Jr., president of MicroVote Corp., Indianapolis, says his electronic-voting machines cost about $4,000. The overall system cost can be double that of an optical-scan system because multiple machines are needed in every precinct. Mr. Ries tells municipalities they can usually recoup that difference within five to 10 years and eventually save money through lower ballot-printing costs.

Internet voting or voting by mail are possibilities but appear doubtful for widespread use in the near term.

Some elections officials aren't confident that optical scans are any better than using punch cards. Both allow overvoting, or voting for two candidates in the same race, which can cancel out the vote.

And optical-scan systems have run into high-profile problems. In Hawaii two years ago, Election Systems & Software Inc., Omaha, Neb., had to pay for a statewide recount in the governor's race because six optical-scanning machines failed to read ballots. The company says it was one of the first elections for a new model and the problem was fixed.

In Georgia, Secretary of State Cathy Cox is pushing for a uniform electronic-voting system. Her office began contacting voting-machine vendors last week to develop a budget request for next year. She envisions a pilot project by 2002 in about 25 counties and possibly a statewide rollout in time for the next presidential election.

"We feel this type of electronic equipment is superior to all other systems out there," says Ms. Cox, adding, "No doubt it will be a multimillion-dollar expense to switch over. But do people want to bite the bullet to have an accurate system?"

Industry officials agree that both punch cards and optical-scanning offer about the same degree of accuracy. "Our margin of error is far less than 1%," says Todd Urosevich, vice president of customer services at Election Systems & Software, one of the big three voting-machine vendors.

Bill Kimberling, deputy director of the FEC's election administration office, warns that better, smarter technology may never eliminate one of the top variables in an election count's execution: human error. Despite all the talk of "hanging chads," in the Florida vote, key errors in Volusia and Palm Beach counties -- that resulted in more than 900 ballots being overlooked in the first returns -- were the result of an elections worker improperly operating a vote-counting machine.

"The day we get voting equipment that operates perfectly and without error is the same day we get a car that never gets into an accident," says Mr. Kimberling.

Industry players who could benefit:

* Election Systems & Software. The company was formed from the 1997 merger of American Information Systems Inc., Omaha, Neb., and Business Records Corp., Dallas. ES&S works with about 2,000 counties and sells both optical scanning and electronic systems.

* Global Election Systems Inc., a Vancouver, British Columbia, company traded on the Toronto Stock Exchange. The company's stock hit a 52-week high of C$2.65 (US$1.71) on Monday on optimism that the presidential recount will lead to more business.

* Sequoia Pacific Voting Equipment Inc., Jamestown, N.Y., a subsidiary of Jefferson Smurfit Group PLC, a paper-products company based in Ireland. Riverside County in California had the first large countywide election using electronic touchscreen voting last week -- a $14 million system purchased from Sequoia.

Losing out may be smaller companies invested in punch cards. Paul Nolte, president of Election Resources Corp., Little Rock, Ark., an eight-employee company which primarily sells punch-card systems -- including the one used in Palm Beach County -- says he will focus now on developing an Intranet voting system that avoids security problems related to the Internet.

"I expect this current situation will cost us a number of good-sized counties in the next two years," he says.

Write to Chad Terhune at and Joni James at

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To: levy who wrote (33)11/19/2000 7:20:01 PM
From: Carolyn
   of 69
This Terhune fellow sure has an apt name, doesn't he?

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To: Carolyn who wrote (34)11/20/2000 12:49:56 PM
From: Jay Arkay
   of 69
Global Election Systems (TSE symbol GSM) is really the only way to go for investors who want in on this industry. The other players are either very small (and mostly private) or privately held (ES&S) or a tiny part of a publicly traded conglomerate (Sequoia Pacific Systems, part of Jefferson-Smurfit). For those wanting to find out more about Global, you can download their latest annual report from their website at (go to the "news" section) and/or hear the webcast of their latest annual general meeting (also accessible through their website). For more due diligence, also check on the Global forum at Stockhouse ( which has been running some three years. You will see both promoters and bashers there (some of the latter obviously including ES&S insiders), but it is clear that this period has been a rough one for investors in the company. Things recently appear to have taken a significant turn for the better, not only the fallout of the US election chaos but also a new top management and board of directors at Global who are clearly focused, have a coherent vision, and full of energy. The company also has recently put into place important joint ventures with Soza in Washington, DC, and with Indra in Europe. Global officials are now exploring a possible US exchange listing, and I would expect a surge in the share price once that is achieved; but most US brokers can easily arrange for the purchase of shares on the Toronto Stock Exchange, where Global now trades. (Note that Global now reports in US dollars, has its major operations in Texas with some sales and research remaining in Vancouver.) But do your own due diligence.

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To: Jay Arkay who wrote (35)11/21/2000 7:21:03 AM
From: levy
   of 69
Jay I was coming to the same conclusion......its kind of interesting how gsm and ess have brothers in high management.......wonder how that works.......thanks for your input

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To: Jay Arkay who wrote (35)11/21/2000 1:13:01 PM
From: Jon Tara
   of 69
Jay, Global apparently also trades as an ADR on the pink sheets as GLELF.

I bought some through TD Waterhouse. Since Waterhouse is based in Canada, I assumed that they would buy it on the Toronto exchange. But I guess this was easier for them. The ADRs trade in US$, of course.

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To: levy who wrote (36)11/27/2000 12:15:31 AM
From: KLP
   of 69
levy...something is ODD here...Did you notice the SAME address in Arkansas (Little Rock) for the SAME small company that made the machines used in the THREE counties in FL that were contested...???? And, I didn't see this company on the Vendor's list you listed earlier on this thread....Does anyone know if this man is still the owner of this company??? Looks like his comment here is a VERY LARGE UNDERSTATEMENT!!

Message 14844517

Losing out may be smaller companies invested in punch cards. Paul Nolte, president of Election Resources Corp., Little Rock, Ark., an eight-employee company which primarily sells punch-card systems -- including the one used in Palm Beach County -- says he will focus now on developing an Intranet voting system that avoids security problems related to the Internet.

"I expect this current situation will cost us a number of good-sized counties in the next two years," he says.

Here are the companies listed on the Florida Election site you listed earlier....

Election Resources Corporation
855 Plaza West, 415 N. McKinley, Little Rock, Arkansas 72205

Phone (501) 663-4678

Election Tabulation Network (ETNet)
punch card; Votomatic (VM) type; central tabulation

11 Counties

Broward Lee Pasco
Collier Marion Pinellas
Highlands Osceola Sarasota
Hillsborough Palm Beach

ETNet, Inc.
855 Plaza West, 415 N. McKinley, Little Rock, Arkansas 72205

Phone (501) 663-4678

Election Tabulation Workshet and/or ETNet
punch card; Votomatic (VM) type; central tabulation

1 County


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To: levy who started this subject11/28/2000 1:45:24 AM
From: KLP
   of 69
levy...wake up...look what I found for you! Whole Sist of Links!

Electronic Voting Hot List
This page contains a list of links to Internet sites with electronic-voting related information. It is intended as a resource list for those doing research on electronic voting and those interested in implementing electronic voting systems.
Voting Equipment and Services Vendors
ELEX Voting Systems - manufactures a touch-screen voting terminal
Hart InterCivic - "private AND secure Internet voting"
Sequoia-Pacific Voting Equipment - "The Global Election Company"
e-lection - "Combining election news, candidate information, pre-election polling, secure online voting, and instananeous election results" - "offering secure solutions for ballot creation, voting, and tabulation"
Electoral Products - from the ACE Project Website - "the secure internet voting company"
Xtol - manufacturer of a "portable wireless keypad system that is used to ask multi-choice questions of groups of people in a variety of training, presentation, surveys and teaching situations"
Global Election Systems - voting equipment and services vendor
Fidlar & Chambers Co. - voting equipment and services vendor
Election Systems & Software - voting equipment and services vendor
Guardian Voting Systems ELECTronic 1242 Voting System - information about an electronic voting booth product
Diversified Dynamics, Inc. - a company that produces "electronic voting systems" and "ballot software"
Microvote - developers of electronic voting tabulation software and distributers of DRE units.
TrueBallot, Inc. Democratic Governance Systems - information about electronic voting booth, vote-by-mail, and vote-by-phone products
Worldwide Election Systems, Inc.
Surveys International - manufactures a patented double-sided, full-face ballot DRE, available through most major systems integrators
Millennium Technology Inc. - "specializes in state of the art, electronic voting systems which are custom designed for corporations and municipal governments"
DRS Data & Research Services plc
Reply Wireless Response Systems - "The Reply family of audience response/voting products is used for small and large group voting"

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To: KLP who wrote (39)11/28/2000 7:25:14 AM
From: levy
   of 69
thanks klp.......getting certified in the usa is not easy from what I here.....some have said it could take up to 2 years....I found a list similar to yours in an earlier post that lists those that are certified...what I don't know is if certification is a state by state thing or not...I thnk it is...also being able to invest is another thing.....several have pointed out that gsm is the only the moment I have been limiting my assestment to gsm but I jst can't get myself to invest with the stock up 50% already since election

Global Election Systems Inc - Street Wire

Global Election positioned for future of voting

Global Election Systems Inc GSM
Shares issued 18,583,672 2000-11-20 close $2.35
Tuesday Nov 21 2000 Street Wire
by Stockwatch Business Reporter
In a world of surging Internet access, on-line banking and automated teller machines -- not to mention the widespread availability of cheap electronic calculators -- the events following the Nov. 7 U.S. presidential vote in Florida were an uncomfortable reminder that while the United States may lead the world in developing and using computer technology, there remain stubborn pockets of technological backwardness capable of delaying national-election results in the world's only superpower for weeks, possibility longer.
University of Iowa computer science professor Douglas Jones says Global Election Systems is one of a half-dozen-odd electronic voting machine suppliers that are in a position to benefit from an election-hardware rethink that is sure to follow the Florida recount debacle. He says electronic voting machines will most likely replace a hodgepodge of antiquated systems that have been in continuous use, in some places, for more than 50 years.
"All these competitors are positioned to take advantage of what will be a booming market as jurisdictions that have been using punch cards run like the dickens to get away from this technology," Prof. Jones says. "In the near term, I would expect a big shakeup because of this election disaster and a lot of people are going to be out shopping for new voting hardware." Farther down the road, Dr. Jones contends that with the emergence of direct recording electronic voting machinery and the changing industry standards that will probably emerge, "Global is in a position to do well."
Global has already proved the benefit of its electronic voting systems in the current Florida pressure cooker -- as have some of its competitors that have their own systems operating in the state. When officials in Florida asked for recounts of all balloting, results from Global's machines were recounted in hours, not days or weeks. More importantly, the recounts were quickly cleared by election officials as accurate, without controversy and without the lawyers or images of workers haggling over whether a hole was fully punched through or whether a hanging chad was, in fact, simply an errant bit of paper.
"We have 17 counties in Florida and on recount all 17 had exactly the same results" as the original vote tallies, says Global director Clinton Rickards. In some jurisdictions, officials wanted the company to feed through the original hard-copy ballots, while others were satisfied with a simple retally of the totals. "Because the totals came out the same, there was no problem," says Mr. Rickards, a programmer who in 1986 began developing the forerunner of Global's current electronic voting systems.
The developments provided Vancouver-based Global with a short-term boost. Its shares gained 88 cents to $2.65 (Canadian) Nov. 13 on unusually high volume of 865,432 shares on the Toronto Stock Exchange following an initial flurry of press coverage about the company; the shares have since eased to $2.40 (Canadian) on much lighter volume. According to Global officials, what is more important than the short-term gains of the shares is the credibility the company gained in the Florida recount and how the issue of electronic balloting has been highlighted as an area that needs legislative attention.
Some states are moving quickly toward updating their mid-20th-century balloting technology. In Georgia, Secretary of State Cathy Cox is pushing for a uniform electronic-voting system. She is hoping for a 25-county pilot project by 2002 and possibly a statewide rollout in time for the next presidential election. The Wall Street Journal quoted Ms. Cox as calling electronic balloting a "superior" system and Georgians will have the opportunity to decide whether statewide electronic balloting is worth the cost.
The cost is much higher than hole-punch or any of the older systems. A California study indicated that if Los Angeles county were to upgrade to an electronic system (it is now predominantly punch cards), the cost would be $350-million (U.S.).
Larry Ensminger, Global's vice-president of business development, says the cost is variable and tends to work on volume discounts -- the more you vote, the cheaper they are per voter. Global's AccuTouch touch-screen system costs $3,500 (U.S.) per unit "plus or minus many other factors," Mr. Ensminger said from the company's Texas office. Each unit would typically handle 350 registered voters, and that number can also change depending on the state, county or precinct in question. The systems are scalable, so additions can be made at a later date.
The Florida fiasco has raised the issue of voting reform to the point that many states are considering an appeal to the federal government for funding to overhaul their present systems. Counties are responsible for all three levels of government elections -- civic, state and federal. In the past, states and counties provided this funding. "What I'm hearing now in just the past week is that a lot of the senators and governors are saying that maybe they should have the power to upgrade this technology," Mr. Rickards says.
Global, which is also listed on the OTC Bulletin Board, has built its annual revenues from $3.5-million (Canadian) for the year ended Dec. 31, 1992 (net profit $58,825(Canadian)) to revenue of $20,236,828 (U.S.) and net income of $1,107,419 (U.S.) for the year ended June 30, 2000. Its balance sheet is bolstered by a working capital position of $14,731,648 (U.S.) and retained earnings of $22,496,464 (U.S.). While closely held competitor Election Systems & Software Inc. (ES&S) dominates the field, with systems in 2,200 U.S. counties and 350 employees, Mr. Rickards contends that the smaller Global (its systems are in 850 jurisdictions worldwide, including Canada) sells more new equipment.
Formed by the 1997 merger of American Information Systems and Business Records, ES&S can traces its origins in the business to the mid-1960s. Global is much newer. Its first sale was in 1989 to a county in Minnesota, while the second sale was in 1990 to Tallahassee, Florida's state capital and centre of the current recount controversy. It listed on the former Vancouver Stock Exchange in November, 1991, following the 1:8 rollback of Macrotrends International Ventures.
The Florida vote has probably advanced the electronic voting industry's marketing efforts by years. Today, punch card technology (at 37-per-cent use, the most popular system in the United States) dates to the 1960s, while hand levers, which date to the 1940s, command 22-per-cent popularity. One in four use optical scan systems, while 7 per cent of U.S. voters use keyboard or touch-screen systems.
With an overhaul of the country's voting system over the next few years a possibility, the industry's existing players may fear some of the bigger computer companies may want to enter the sector to dominate what could be a lucrative field.
At least one industry source says participation by major computer companies is actually an opportunity for these players. "IBM and Unisys have tried to get into this business and have been in this business," he says. "IBM was the creator of the punch-card system in the 1960s, and Unisys has done some developmental work in this area as well." The difference is that the larger companies do not have the patience for the long gestation periods needed to make a sale, and are happier to see sales of their hardware run the software developed by players in the electronic voting machine industry.
Global makes two models of electronic voting systems. One is AccuVote, a PC-based optical scan system, in which voters shade in the candidates of choice with a pencil and a scanner records the results; a paper record of the vote is left with officials. This system, of which Global is only one supplier, is used in about a quarter of the nation's 3,140 counties.
The other system is AccuTouch. With it, voters are given smart cards that contain the data needed to vote for candidates in that particular precinct. Once inserted, this information is displayed on a 15-inch monitor in large letters and the voters touch the screen to indicate his or her preferences. These systems are used by about 7 per cent of voters.
Mr. Rickards says that older people appear to have few problems with either the touch-screen or optical scan systems. "We find that seniors have no problem, either filling out a ballot or filling in a circle or touching a screen," he says, adding that the touch-screen system is particularly user-friendly. "It's in very large type and it's impossible to cast a double vote. Make a mistake and do it again. You can't put in another vote until the first is erased," Mr. Rickards says.
A number of Canadian jurisdictions have picked up Global products, including the City of Vancouver, which used the optical-scan system citywide for the civic election in November last year. Global's touch-screen system was first used in the Barrie, Ont., civic elections held last week.
Prof. Jones says that over the years advanced voting technology has produced what might be considered surprisingly similar results, indicating that the main players are making the best use of available technology and arriving at the same "solutions." He says that independently of each other, Global and its main competition came out with machines whose technology is remarkably similar but not the same. One competitor, Fidlar Doubleday Inc., uses a personal identification number (PIN) in its touch-screen system, while Global uses a smart card. Both systems are designed to be networkable and both are designed with the possibility of Internet voting in mind.
"Each has independently come up with effectively the same idea for what the future ought to look like, and they're right in their big picture view," Prof. Jones says.
The similarities between the systems tend to end at that point, however. The real differences are found in the programming, and the professor says what is needed before the technology is accepted on a truly national scale are standards. Given uniform standards, competing suppliers will provide voting systems that are essentially the same technology but which may look and feel slightly different; additions could be made using different suppliers.
At the moment, no such standards exist, and getting the industry to agree on such standards may be a challenge. Further, "The current federal and state laws do not properly allow for the state of the art, much less what the state of the art will be," Dr. Jones says. Talk of such standardization will be a source of great concern to these vendors "because I know I and a number of other computer professionals are going to be pushing hard for open-systems standards."
While there may be great anxiety among vendors about what these standards will ultimately be, standardization of any kind will be a tremendous boon to the industry -- even though standardization would presumably allow for many more players to enter the business.
At the moment, each supplier tends to have its own proprietary standards for how they communicate a result to a central system, and this locks the customer into buying central vote-tallying software from that particular vendor. This in itself is an inhibiting factor in selling the systems because from then on, buyers are essentially denied the benefits of competition. "Federal standards don't govern that central-vote-tallying software standard, and they ought to. And in fact I think what we really need are federal standards for the electronic transmission of vote results that are independent of whether it's Internet transmission or transmission by smart card or modems and phone lines," Dr. Jones contends.
The industry can make its own standard or a standard can be imposed by the states or by the federal government "but we need a standard," he argues. "This will shake the industry and how that works itself out is going to be interesting."
A parallel of the importance of standardized technology is with the home PC. In the very early 1980s, many different suppliers competed with their own proprietary systems, and it was not until a de facto winner emerged -- the IBM/Microsoft standard -- that the PC industry really took off later in the decade and on through the nineties.
Prof. Jones and some of his like-minded colleagues want to see open source technology, which takes standardization one step further. Open source means that the source code is available for inspection by qualified individuals. This open-source-versus-proprietary debate is at the heart of the challenge by the open-source Linux operating system and the closely guarded source code of the Microsoft Windows operating system.
Open-source software is the industry's best bet for transparency and trust in a system that requires an unusual amount of trust. "There is a widespread distrust of computer software among election officials and I think it's a deserved distrust," Prof. Jones says. "How can you trust proprietary software to be free of features that are not supposed to be there?"
He notes that independent third party authorities test the current software used in electronic balloting, but programmers are skilled at hiding features that are not supposed to be there. Usually these "Easter eggs" are harmless, such as users being able to play the programmer's college fight song if they hit a particular sequence on the keyboard, but some are not so benign and can be embarrassing for a client -- such as Microsoft -- that ordered the software, inspected it and took delivery from the supplier.
Prof. Jones envisions the demise of proprietary third party code and a move toward open source code in electronic voting. His preference is an open source code along the lines of Linux. "Linux is entirely open source, therefore you can have a version of Linux which you simply freeze say we'll use this version and the certification process includes the verification that this is indeed the version of the system on the machine, and that version is posted on the Web and if anyone who is suspicious can inspect it," he says.
If big-picture Internet thinkers are to be believed, it is only a matter of time before voters exercise their franchise from the comfort of home. On-line voting received a lot of attention earlier this year when the Democratic primary in Arizona and a few other smaller elections were held on-line.
Experts say these elections amount to little more than data collection and not to be confused with a federal or state elections, where the scale of the undertaking and the need for transparent verification of the results must be in place. Prof. Jones, for example, says the only way Internet voting could work today is if each voter were issued CD-ROMs. The user would boot his or her computer from that CD-ROM, which would contain a complete certified software system for election administration and so bypass his own operating system.
"This would be so inconvenient, I think what we'll see is not voting from home on a widespread basis. What we'll see is voting from polling places and special-purpose voting machines built like tanks and running certified special-purpose vote-counting operating systems and voting software," Dr. Jones says. "And that's exactly what companies like Global are positioned to sell, and that is exactly what we should be looking for."

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To: levy who wrote (40)11/28/2000 1:11:19 PM
From: KLP
   of 69
levy...did you have any thoughts on my earlier message??? Something does indeed seem ODD there!!

And also, do you know of a link that would show what each State and County would use as their current voting system? I've looked and haven't found one...

Message 14884316

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To: KLP who wrote (41)11/28/2000 1:25:52 PM
From: levy
   of 69
I looked for that and could not find it either...the strangest thing is the state of florida has the most complete web site there is for this if they were planning for this main event.......maybe they have rigged the hole thing to draw attention to Florida.....that Sec of State lady seems capable of that...right now I have forgotten the stupid presidential vote issue and am trying to figure out how they could vote in Florida State above Miami for the Orange Bowl title game when in fact Miami beat Florida State.....I will go back and read your post again to see what you were talking about.

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