Market Analysis – 93111605 – Voter registration or counting or analysis or scrutiny services

Market Analysis Brief: Voter Services (UNSPSC 93111605)

Executive Summary

The global market for voter registration, counting, and analysis services is an estimated $3.2 billion for 2024, with a projected 3-year CAGR of 7.1%. Growth is fueled by increasing digitization of election processes and heightened public demand for transparent, secure, and auditable results. The single greatest market dynamic is the dual threat and opportunity presented by cybersecurity: state-sponsored threats and public mistrust are driving significant investment in advanced security, auditing, and analytical services, creating a premium for suppliers who can deliver verifiable integrity.

Market Size & Growth

The Total Addressable Market (TAM) for election services is driven by government spending cycles, which are becoming more consistent due to the need for continuous system maintenance and security upgrades. The market is projected to grow at a 7.5% compound annual growth rate over the next five years, spurred by technology modernization and regulatory mandates. The three largest geographic markets are the United States, due to its highly decentralized and frequent election cycles; India, due to its massive electorate; and Brazil, a leader in nationwide electronic voting technology and services.

Key Drivers & Constraints

1. Demand for Integrity & Transparency: Public and political scrutiny over election outcomes is the primary demand driver, forcing administrations to invest in robust auditing, chain-of-custody tracking, and publicly verifiable reporting services.
2. Regulatory Mandates: Evolving legislation around cybersecurity (e.g., CISA guidelines in the U.S.), voter accessibility (ADA compliance), and post-election audits are compelling governments to procure new or updated services.
3. Digital Transformation: The shift from manual, paper-based processes to electronic poll books, online voter registration portals, and automated ballot tabulation systems necessitates sophisticated integration, support, and security services.
4. Cybersecurity Threat Landscape: Persistent threats from state-sponsored actors and other malicious groups require continuous investment in threat detection, penetration testing, and incident response services, adding complexity and cost.
5. Cost & Labor Inputs: The rising cost and scarcity of specialized cybersecurity talent and cleared IT professionals act as a constraint on supplier margins and can delay service implementation.
6. Public Trust & Misinformation: The erosion of public trust, amplified by misinformation campaigns, forces suppliers and their government clients to invest heavily in public communications and voter education services to demonstrate process integrity.

Competitive Landscape

Barriers to entry are High, defined by stringent, lengthy, and costly government certification processes, the critical need for established trust and reputation, and deep-rooted relationships with state and local election officials.

⮕ Tier 1 Leaders * Election Systems & Software (ES&S): Largest U.S. market share; offers a fully integrated ecosystem of hardware, software, and comprehensive election management services. * Dominion Voting Systems: Significant presence in the U.S. and Canada; known for its ImageCast line of products and accompanying support and tabulation services. * Hart InterCivic: Focuses on a user-centric design with its Verity voting system, providing tailored service packages for U.S. county-level clients. * Scytl / Paragon Group: A global leader with a strong presence in Europe and Asia-Pacific, specializing in secure online voting technology and election modernization services.

⮕ Emerging/Niche Players * KNOWiNK: Leader in electronic poll book software and hardware, focusing on efficient and secure voter check-in services. * VotingWorks: Non-profit developing affordable, open-source voting systems and risk-limiting audit (RLA) tools to enhance transparency. * Runbeck Election Services: Specializes in the physical aspects of mail-in voting, including ballot printing, mailing, and high-speed signature verification/sorting services. * Clear Ballot: Focuses on innovative paper-ballot-based systems and post-election audit solutions that use visual verification.

Pricing Mechanics

Pricing is typically structured on a multi-year contract basis, aligned with government procurement cycles. Common models include a per-registered-voter, per-year fee for ongoing registration database management, a fixed-fee project price for a full election cycle's services, or time-and-materials for specialized consulting like security audits or litigation support. Contracts often bundle software licensing, hardware maintenance, pre-election setup, election-day support, and post-election analysis into a single package.

The price build-up is dominated by skilled labor. The most volatile cost elements are directly tied to security and compliance. 1. Cybersecurity & IT Labor: Specialized talent for system hardening and monitoring. Recent Change: est. +15-20% YoY. 2. Cyber Liability Insurance: Premiums have surged due to heightened litigation risk and geopolitical threats. Recent Change: est. +25-40% YoY. [Source - Insurance industry reports, 2023] 3. Compliance & Certification Costs: Costs associated with meeting new state or federal security standards. Recent Change: est. +10% per new mandate.

Recent Trends & Innovation

• Adoption of Risk-Limiting Audits (RLAs): A growing number of states are mandating or piloting RLAs, a statistical method to confirm election outcomes, creating demand for specialized software and consulting services. (2022-Present)
• AI in Ballot Processing: Pilot programs are using Artificial Intelligence (AI) and Machine Learning (ML) for more accurate and efficient signature verification on mail-in ballot envelopes and to adjudicate voter intent on ambiguously marked ballots. (2023-2024)
• Cloud Migration for Voter Registration: States are moving away from siloed, on-premise voter registration databases to statewide, cloud-hosted systems (e.g., Salesforce, Microsoft Azure) to improve security, data integrity, and accessibility. (2022-2024)
• Increased Federal Oversight & Funding: The U.S. Cybersecurity and Infrastructure Security Agency (CISA) has expanded its free services, including vulnerability scanning and threat intelligence sharing, forcing commercial suppliers to enhance their value proposition beyond these baseline offerings. (2022-Present)

Supplier Landscape

Regional Focus: North Carolina (USA)

As a politically competitive "swing state" with significant population growth, North Carolina represents a high-demand, high-scrutiny market. Demand is driven by the NC State Board of Elections (NCSBE), which manages a rigorous certification process for all voting systems and service providers. The state's 100 counties execute the elections, creating opportunities for suppliers at both the state and local levels. ES&S is a dominant provider of counting systems in the state. The proximity to the Research Triangle Park tech hub provides a strong local labor pool for IT and data analysis roles, though competition for talent is high. The regulatory environment is dynamic, with frequent legislative changes impacting election administration rules.

Risk Outlook

Actionable Sourcing Recommendations

1. Decouple Audit Services for Independent Verification. To enhance integrity and mitigate vendor lock-in, issue a separate RFP for post-election audit services. Piloting a contract with a niche Risk-Limiting Audit (RLA) specialist like VotingWorks or Clear Ballot for a subset of jurisdictions will provide an independent check on the primary counting system provider and build public trust through verifiable, third-party analysis.

2. Mandate Modular Contracts with Data Portability. Structure new service agreements to be modular (e.g., separate modules for registration, check-in, tabulation). Include explicit data portability and standardized API clauses to ensure a new vendor's module can be integrated in the future. This strategy reduces switching costs, prevents vendor lock-in, and allows for faster adoption of best-in-class security innovations from different suppliers.