As once-high-flying public Web integration firms struggle to stay afloat and meet the high growth demands of shareholders, smaller e-services companies are snaring customers left stranded, bypassing the costly process of courting them. They're also assessing other nimble companies for possible mergers or acquisitions, on the theory that strength in numbers affords some protection against obsolescence.

SBI CEO Ned Stringham says his firm has picked up 200 accounts from bankrupt MarchFirst.

Still, the volatility in the Web services sector has many industry executives feeling uneasy. Patrick Daily, CEO of Meritage Technologies, Columbus, Ohio, says he knows consolidation is inevitable.

"We all know we're going to lunch. The question is, are you going to be on the plate or in the chair?" Daily says.

Fairfax, Va.-based Headstrong plans to be one e-solutions firm seated at the table. Kevin Murphy, chief creative officer, says the company already has made two acquisitions and, thanks to some private investments, has money in the bank to do more.

"We will make [more] acquisitions" Murphy says. "They will be small in number but relatively significant."

There's one problem, however: finding the right companies. "There are a lot of opportunities, but not a great deal of value out there," Murphy says.

Lucinda Duncalfe Holt, CEO of Destiny, Conshohocken, Pa., says she sees interested buyers and potential sellers. But the real trick is wrapping up a deal.

"It's a challenge," Holt says. "Any acquisition worth doing would need to have a significant impact on our performance, and valuations are very difficult right now."

What's more, many e-business acquisition candidates aren't worth buying, although Destiny,which focuses on the lucrative financial services market,has drawn interest from Big Five consulting firms, Holt says.

Last week in New York, Holt, Murphy and Daily touched on M&As in the Web services sector in panel hosted by IBM and moderated by Anne Smith, IBM's vice president of consultants and integrators.

The executives discussed how consolidation has picked up in the e-services realm, which has seen IBM Global Services buy integrator Mainspring and Compaq unveil a deal to acquire e-business consultancy Proxicom.

Smith declined to comment on whether IBM planned to buy more e-business integrators, but she has previously said that IBM is eyeing partnerships with lesser-known Web services firms.

And some of those companies are prospering of late by scooping up business from Web consulting and integration firms that have fallen on hard times. For example, Salt Lake City-based SBI last week said it acquired some 200 customer accounts,including American Airlines, Mattel and Visa,formerly handled by marchFirst, which filed for bankruptcy protection earlier this month.

Some industry observers questioned SBI's ability to digest such a large, swift business expansion, a situation that in part derailed marchFirst and Scient. However, SBI has nearly doubled its head count by "acquiring" 300 ex-marchFirst employees, which would give SBI about 700 people in nine U.S. offices. And in an early sign that SBI's internal infrastructure may be up to snuff, a company spokesman says the firm was able to add all the former marchFirst staff to its e-mail system in a couple of days.

SBI CEO Ned Stringham declined to disclose terms of the marchFirst deal, but he says it's tough to assign a value to the process of wooing and winning new accounts, especially in today's market. "This is one of those rare opportunities, to be able to pick up referenceable customers like this," Stringham says.

Watertown, Mass.-based e-solutions provider Molecular, formerly known as Tvisions, also had a recent customer windfall in recent months. William McKeon, chief marketing officer, says that in recent months Molecular,which is funded by CMGi@Ventures,has picked up contracts with The Financial Times of London, which previously worked with Razorfish and Agency.com; Putnam Investments, a former iXL client; and State Street Global Advisors, another former Razorfish account.

"We're beating out a lot of the major players for jobs," McKeon says. "A lot of [Web services firms] are spending a tremendous amount of capital. But building a business model without the revenue to support it is really a house of cards."

Marie Lingblom contributed to this story.