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Home - News
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Consolidated Democracy
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ES&S buys out largest competitor creating unparalleled dominance in elections industry
by Bryan Cohen
Around 120 million votes in the United States could be counted on the machines of a single private company if a recent merger is allowed to stand. Election Systems & Software, Inc. announced Sept. 3 that it purchased Premier Election Solutions, a subsidiary of Diebold, Inc. The deal, involving the top two U.S. voting machine manufacturers, would give ES&S a dominant market share in the nations voting technology industry.
The purchase instantly drew fire from election rights advocates; some are filing anti-trust complaints with the U.S. Department of Justice, which would decide if the deal would create an industry monopoly.
“This can’t be allowed to stand,” said Bev Harris, founder and director of the elections watchdog group Black Box Voting. “One privately held company would hold the vote count for 80 percent of America.”
The Boston Globe has called Harris “the godmother” of the election reform movement. Time Magazine called her book, Black Box Voting, “the bible” of electronic balloting. She runs the Website blackboxvoting.org. Harris began writing about the elections industry in 2002 after she discovered then U.S. Sen. Chuck Hagel had been CEO of ES&S, the company predominantly used in Nebraska elections. The Omaha World-Herald said it is a minority shareholder in ES&S.
According to Diebold, the company had been looking for a buyer since 2006. Premier had been operating at a loss since Diebold purchased the company in 2002, Diebold spokesperson Mike Jacobsen told The Reader. Premiere generated $88.2 million in revenue in 2008; around 2.8 percent of Diebold’s total revenue. Diebold sold Premiere for $5 million (about one-fifth if what it paid for the company in 2002), recognizing a pre-tax loss of up to $55 million. Jacobsen said the sale was an opportunity for Diebold to focus on its core industries — property security systems and ATM’s.
In 2004, Diebold was criticized for being biased when the company’s then-Chief Executive Walden O’Dell said he would do everything in his power to turn out a win for President George W. Bush.
Several calls from The Reader to ES&S were not returned.
The third largest voting machine provider in the U.S. is California based Sequoia Voting Systems. The company services elections in 16 states.
Premiere operates in 33 states and controls a 33 percent market share, according to its Website. Harris said she expects the merger to be struck down within a week.
“It gives you one fist in control of the manufacture, sale, on-site support and programs in the machines,” she said. “It’s a classic example of what was conceived of in the anti-trust and monopoly.” ,
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