Latest Count: 2,475 SEM Firms
Ah, how I long for the good ole' days of 2003, when there were a mere 5 or so SEM firms. It was soooo much easier for advertisers to make SEM decisions, the SE's themselves knew who to spend time with, and the SEM's could track competitors with a 5-column spreadsheet.
Fast forward to 2008 and the SEM vendor list (tools and/or agencies) looks much like the long keyword tail everyone's been talking about. Here's a partial list of SEM vendors to give you an idea of just how many there are:
Doubleclick/Performics - product is called DART Search
The Search Agency
Web Trends Dynamic Search
Salesforce.com for Google AdWords
The Search Works (BidBuddy)