The Business of Voting

Market Structure and Innovation in the Election Technology Industry


Russian interference in the 2016 presidential election, as documented in assessments by the US intelligence community, has put a renewed spotlight on the integrity of the America’s voting infrastructure. Not since the “hanging chad” debacle during the election of 2000 has so much concern been directed to enhancing the technology used to cast and count votes. Nothing is more essential to our democratic process.


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With the threat of further Russian meddling hovering over the upcoming 2018 midterm elections, there have been many calls for quick action, in the form of sharp diplomacy with Russia, as well as Congressional support (financial and otherwise) for instituting heightened cybersecurity standards for our voting systems. But such action alone will not be enough to secure our elections. As recognized by the Open Markets Institute, “one of the biggest threats to the integrity of our electoral system has been widely overlooked: the concentration of the voting machine industry into the hands of three corporations,” which has had the effect of stifling innovation in the development of newer, more reliable, and more secure voting technology. The problems with this concentrated market structure in the election technology industry were not overlooked by Penn, however. They were identified and described in a report published in 2016 by the Wharton Public Policy Initiative, “The Business of Voting.”

Very little has been written previously about this industry, despite how critical it is to the functioning of our democratic processes. As this study initially got underway, it became clear that one of the most significant boundaries to conducting a useful analysis was the dearth and inaccessibility of industry data. The first goal of this report therefore is to compile a current set of facts about the election technology industry, including the market players, industry revenue and profitability, and the competitive dynamics among the relatively few vendors that manufacture and sell election systems.

The gathering of the industry facts facilitates the second purpose of the report: to provide an original analysis of the industry dynamics that can shed light on what has prevented the election technology industry from enjoying the robust level of innovation seen in other technology sectors. In the process, it also describes strategies that some election officials are pursuing to cope with the shortcomings of the current market:


  • Buyer coalitions, which can give jurisdictions greater bargaining power for getting vendors to provide systems that are both better priced and more customized to their needs;
  • Open source technology, which proponents believe may catalyze the development of new competitive markets in voting systems solutions;
  • Modified certification processes, to support a move to modular voting systems built from less expensive commercial off-the-shelf components.

As the report explicates in detail, the real effects (and possible pitfalls) of these strategies are not yet fully known. But they are nevertheless reflective of the report’s key contention: that a long-term solution to the election technology crisis is unlikely to be had until policymakers and market actors address the underlying business issues and take steps that catalyze changes in the structure of the election technology industry.



The faculty director for this report was Lorin Hitt, PhD, the Zhang Jindong Professor and Professor of Operations, Information and Decisions at the Wharton School of the University of Pennsylvania, who supervised a team of six Wharton students in carrying out the research and doing the industry analysis.