Let’s get serious

With the high prevalence of counterfeit spares finding their way into authorised distribution channels, it is time for regional stakeholders to tackle the production of fake tech goods.

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Let’s get serious ((ITP Images))
By  Manda Banda Published  December 23, 2013

With the high prevalence of counterfeit spares finding their way into authorised distribution channels, it is time for regional stakeholders to tackle the production of fake tech goods.

A recent report by printing solutions vendor Xerox that revealed that it had conducted raids in China and Dubai earlier this year that turned up more than 55,000 boxes of counterfeit parts made for its imaging and printing products raises a key problem about the prevalence of fake goods in the channel.

And the scary part, according to Xerox, is that those 55,000 boxes, which were slated for distribution in authorised channels in the US, Germany, Netherlands, Turkey, Russia, Brazil and South America, are just a drop in the ocean, given the size, and continued growth, of the counterfeit market in IT.

According to research from The Imaging Supplies Coalition, globally, the size of the counterfeit market is reported to be between $3.5bn and $4bn. And that’s just within the printing and consumables sector. Fake production of IT goods and parts is not just confined to printing and supplies. It is a menace in the networking, semiconductor, PC components and consumer electronics.

Although in the past the channel saw this as an OEM issue, changes in the market as more businesses mature have shown that many partners view counterfeit production of IT goods to be detrimental to their own business and survival and not just an OEM issue.

It is a fact today that the fake goods industry in IT and other sectors is a multi-billion dollar business which impacts governments, resellers and customers due to lost taxes and investments in poorly made products.

While the rise in semiconductor counterfeiting is often laid at the feet of China, that country actually is not the location where most counterfeits are reported. According to research firm IHS, much of the counterfeit-parts problem can be traced back to the enormous amount of electronic waste (e-waste) generated each year in the US. IHS says the US is number one, while China is in second place in terms of counterfeit incidents reported. IHS also noted that 58% of e-waste generated by the US is shipped to developing countries. All too often, noted IHS, these electronic components such as semiconductors are culled from this waste and then returned to the US and other developed countries in the form of counterfeit parts.

Clearly, this highlights a bigger problem in the US’ policy on e-waste.

Given the impact in lost revenue and jobs, and taxes, there is a need for all OEMs to regularly work with authorities and keep fake spares out of the channel. The last thing partners want is to find fake parts in solutions they are selling, which were acquired from authorised channels.

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