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The Almighty Buck Hardware

Fakes, Coming to a Store Near You 286

fishdan writes to tell us that while most Slashdotters have their own trusted sources for gear there is a growing concern that all consumers should look out for. According to PC World, more and more counterfeit hardware is coming to market each year. From the article: '...batteries aren't the only tech item that counterfeiters love. In October 2004, U.S. Customs and Border Protection officials in Anchorage, Alaska, seized 20,000 suspected fake Memorex USB memory key thumb drives from Asia. And last year, Miami officials seized 900 allegedly phony laptops valued at $700,000. "Maybe it's a laptop, an MP3 player, or a component like a DVD drive--anything in the digital world can be counterfeited," says Therese Randazzo, a U.S. Customs Service counterfeiting expert.'"
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Fakes, Coming to a Store Near You

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  • I don't get it (Score:4, Interesting)

    by Anonymous Coward on Monday January 09, 2006 @06:36AM (#14425970)
    What is wrong with counterfeit electronics? Do they have different functionality, are they shabbily built, or do they just take profits away from the rightful owners of the product?
  • Re:I don't get it (Score:1, Interesting)

    by Anonymous Coward on Monday January 09, 2006 @06:38AM (#14425974)
    Maybe Its because IP laws or something that "fake HP printers ink" its cheaper but evile.
  • Re:I don't get it (Score:1, Interesting)

    by Anonymous Coward on Monday January 09, 2006 @06:45AM (#14425996)
    Sometimes the factories in third-world-factories that produce the "legit" products also produce those "fake" things. Is there something like this in computer electronics manufacture ?
  • Re:I don't get it (Score:4, Interesting)

    by damsa ( 840364 ) on Monday January 09, 2006 @06:46AM (#14426001)
    Counterfeits are not made to the same standard as originals, if they were made to the same standards then the counterfeiters wouldn't be trying to pass off their goods as fakes, they would be making claims that their products were better.

    When you buy a product from a manufacturer, you as a buyer are protected by warranty laws, a counterfeiter can get away with selling stuff even if the quality is the same as the original for a lower price because they don't have to support you.

    Counterfeiters do take away profits from the rightful owners of the product. Companies spend millions of dollars to develop a product and to appeal to a certain market. If counterfeiters were allowed to counterfeit, then companies would not develop products.

    Also, how would like to buy an Intel computer but only to find that the insides are actually made by a Chinese knockoff company.
  • Re:I don't get it (Score:1, Interesting)

    by Anonymous Coward on Monday January 09, 2006 @06:47AM (#14426005)
    'It's an entirely different matter when you buy a fake cell phone battery and it blows up," says Arch Ahern, Motorola's senior counsel for trademark and marketing.'

    Well i'd expect him to say as much. What facts back him up?
  • Re:I don't get it (Score:3, Interesting)

    by dunkelfalke ( 91624 ) on Monday January 09, 2006 @06:47AM (#14426009)
    they are shabby built, have different functionality and have no warranty.

    here [heise.de] you can see a picture of a fake usb bluetooth adapter. as you can see the antenna is a dummy, the only antenna it has is "drawn" on the pcb. also the bluetooth stack is a different one.

  • Re:I don't get it (Score:4, Interesting)

    by Anonymous Coward on Monday January 09, 2006 @06:48AM (#14426011)
    It goes really far down the chain. Nowdays you can't buy certain power transistors from just anywhere. Prized japense power transistors like even 2sc5200/2sa1943 are being counterfeited. the counterfeit devices have a much smaller die and no heatspreader. they are just glued to the package.

    This obviously has issues with the entire manufacturing process. anything that needed these parts now must be tested.

    counterfeit stuff is almost certainly poor quality, possibly bordering on dangerous. it makes the most sense as you get maximum profits that way.

    Further there is no accountability. A defective and dangerous product could harm people, thusly bringing lawsuits. These lawsuits would target, in this case, innocent corporations instead of outright dishonest ones. the lack of a need to care about the consumer at all makes counterfeitting electronics dangerous.
  • Wait till you see... (Score:4, Interesting)

    by bronney ( 638318 ) on Monday January 09, 2006 @06:55AM (#14426038) Homepage
    what we have in stores for you. Earlier we had soy sauce made from hair juice. Yes, factories in China grinding human hair into juice and mix with water.

    Fake down blankets stuffed with shit polyesters.

    Now hear this, fake EGGS. Yes you heard right. What mogglers my bind was how on earth could you make eggs cheaper than collecting from chickens. The fake eggs were obviously inedible, but will crack and pour just like a real egg, with yolks and stuff.

    The famous fake gucci's and LV's are old news.

    Latest that came in from a buddy who works in shenzhen was that he rode in a fake mercedes benz. They copied all contours and instead of the tri-star, it's a 5 pointed-star (China)! Cool eh.
  • Re:I don't get it (Score:4, Interesting)

    by baryon351 ( 626717 ) on Monday January 09, 2006 @06:59AM (#14426052)
    Others have brought up good comments - that sometimes the counterfeits can be dangerous, not work the same as the real thing, not comply with local laws, be interference-prone electronics etc.

    Another problem is when a device made in the same factory as the real deal (let's say a Toshiba laptop) is sold in the US as a real toshiba. To many people hey, it's a real toshiba, and it's half the price!

    But part of the price of the REAL toshiba is the Quality Control that occurs along the line. Perhaps only 85% of all laptops made in that factory actually end up being accepted by toshiba as inventory, and the rest is set to be dismantled, scrapped or refurbished as something went wrong on the assembly line. So what do you get when you buy the fake toshiba?

    You get one of the *already rejected* "toshibas" that was never meant to be released to the public. Not only was it never given a serial number that matches a toshiba-sold product so all warranty is out the window, it's already been rejected and defined as having problems. Made in the same factory, yes, but not the same quality as the final for-sale object.

    Maybe you'll get lucky and get a solid machine that only has some case defects. Maybe you'll get a lemon that doesn't stay powered on for more than 15 minutes, has no warranty, and you still paid $400 for.

  • Re:I don't get it (Score:3, Interesting)

    by advocate_one ( 662832 ) on Monday January 09, 2006 @07:00AM (#14426057)
    If there's really something counterfeit I'd avoid, it's batteries

    how certain are you that those new brake pads the shop fitted to your car the other week weren't just compressed cardboard? or that bolt holding the engine in place on the wing of the airplane you're boarding today was really manufactured by one of Boeing's proper suppliers. Those are items currently being counterfeited that really scare me.

  • by NigelJohnstone ( 242811 ) on Monday January 09, 2006 @07:03AM (#14426065)
    "In October 2004, U.S. Customs and Border Protection officials in Anchorage, Alaska, seized 20,000 suspected fake Memorex USB memory key thumb drives from Asia."

    Do Memorex even make USB drives, or do they simply buy them in from Asian and stick their badge on them?

    "Miami officials seized 900 allegedly phony laptops valued at $700,000. "Maybe it's a laptop, an MP3 player, or a component like a DVD drive--anything in the digital world can be counterfeited," says Therese Randazzo, a U.S. Customs Service counterfeiting expert.'"

    I bet they were *real* laptops and *real* mp3 players, the only difference was the label. What you're saying is they can fake *labels*. But that's just because the USA has become a fake brand country, companies license a brand like Polaroid or Caterpillar, buy in cheap Asian crap, stick a "Polaroid" badge on it and charge loads more money because people think they're buying American.

    Who cares if those fake brands get pirated, since its the difference between an overprice Asian product and a cheap Asian product, it's still jobs in Asia.

    They should tackle false origin of goods labelling instead, since that's the cause of jobs being lost in USA and Europe. How can an Italian shoe maker compete with companies which appear to be Italian luxury show makers, but are just fake Asian brands with some minor finishing in Italy?

  • Re:I don't get it (Score:3, Interesting)

    by squoozer ( 730327 ) on Monday January 09, 2006 @07:21AM (#14426119)

    Your argument, while good, only fits a small number of cases where the fake could actually hurt someone. I fail to see how a memory stick can blow up and hurt someone.

    A much better reason to discourage this type of piracy is simply because margins are already tight in the electronics world without forcing the few players that exist to fight for their money with people ripping them off. There are areas where I feel pirates play an important roll. Music, movie and clothes production spring to mind. Production costs for these items has drop substantially in recent years but prices haven't generally followed. The pirates are showing the consumers that prices need not be as high as they are paying. I admit that pirates don't have associated development costs and therefore will always be able to sell for less but when you see a pirated copy of a movie for free and the real thing costs £16 ($30) you have to ask where the money is going.

  • Re:I don't get it (Score:3, Interesting)

    by tigersha ( 151319 ) on Monday January 09, 2006 @07:25AM (#14426135) Homepage
    NiMH Battries are not toys. They contain electronic safeguards to ensure they run within parameters otherwise they explode (end they blow up if they run too empty too). This has happened to Nokia in the past and people were hurt because their cellphones started burning. This was caused by fake batteries. The energy density in an NiMH cell is very high.
  • Re:I don't get it (Score:3, Interesting)

    by packeteer ( 566398 ) <packeteer@subdim ... m minus language> on Monday January 09, 2006 @07:51AM (#14426235)
    The reason fake electronics are bad is becuase they are not tracable back to their rightful manufacterer. If there is a low quality batch of, say USB cards, that lose data randomly, why should the non-fake manufacterer have their name associated with them.

    A lot of people here are having the standard knee-jerk reaction of saying only corporate profits benefit by cutting out fakes but thats just not the case. If a compan builds a brand name not with marketing but build a brand name with actually releasing a quality product then why should the be associated with the quality of fake items. Do you want to read a review of a top of the line quality electronics manufacterer and go out and buy the reviewed item only to find you got bought a low quality item?
  • by tpgp ( 48001 ) on Monday January 09, 2006 @08:12AM (#14426288) Homepage
    I bet they were *real* laptops and *real* mp3 players, the only difference was the label. What you're saying is they can fake *labels*. But that's just because the USA has become a fake brand country, companies license a brand like Polaroid or Caterpillar, buy in cheap Asian crap, stick a "Polaroid" badge on it and charge loads more money because people think they're buying American.

    I generally agree with your sentiment about Western Consumers getting sucked into overpaying for cheap crap because of a label (CK clothes instantly spring to mind).

    However - I do actually think trademark is one area of 'intellectual property' that helps consumers.

    If I buy a laptop that has "AMD Sempron 3000+" written on it, I would like to *know* that that's what it is - not an 900MHz Intel Celeron. Similarly, I want the video memory to be whats advertised, etc etc etc.

    Who cares if those fake brands get pirated, since its the difference between an overprice Asian product and a cheap Asian product, it's still jobs in Asia.

    Sometimes you do not get a rebranded equivilant, but something that is completely inferior to what you expected.

    I would be extemely pissed off if I bought one of the Fake AMD CPUs [over-clock.com] that were going around a while ago, to find it overclocked, ran hotter, and had a shorter lifespan that it should.
  • by mwvdlee ( 775178 ) on Monday January 09, 2006 @08:33AM (#14426358) Homepage
    A lot of consumer hardware is sold, with unchanged specifications and possibly minor cosmetic changes, using multiple brands and pricing based primarily on those brand names.
    Would this be considered counterfeit as well?
  • Elevators too (Score:5, Interesting)

    by whoda ( 569082 ) on Monday January 09, 2006 @08:50AM (#14426444) Homepage
    There was a story about counterfiting in an issue of Fast Company last year. In it, there was an example of an elevator company who got called to service an elevator in a high-rise building.

    The elevator company had no record that they had an elevator installed there.
    When the technicians got there, they couldn't fix anything, because the elevator wasn't really theirs. It was a knock-off!
  • Bad News Dude.... (Score:3, Interesting)

    by amcdiarmid ( 856796 ) <amcdiarm@@@gmail...com> on Monday January 09, 2006 @09:02AM (#14426515) Journal
    Even the "Italian" goods are often manufactured in third world countries.

    I can't speak specifically to shoes, but I can speak for sweaters. Production has largely moved out of shops in Italy, and into (Pakistan, Malaysia, ...) other countries. My mother in law used to own & operate a sweater assembly shop. Even using immigrant labor that was low paid by Italian standards, they could not compete with the no pay of Pakistan. (Yes, I know that the workers there are their familys breadwinners.)

    The problem of jobs moving from high paid countries to low ones is endemic, and a good example of a beggar thy neighbor approach to economic production. (You offer companies more incentives to work in your place, and let them pay less for the work.) Eventually everyone works for nothing;(

    Better country of origin laws would work if everyone was willing and able to pay more for goods made in *well paying* countries. However some sort of horrible tax regime based on how much workers receive would probably make more sense.

    my $.02 ($.02, that's more than an hourly wage in a Burma sweatshop;))
  • Re:I don't get it (Score:3, Interesting)

    by bcattwoo ( 737354 ) on Monday January 09, 2006 @09:52AM (#14426814)
    The pirates are showing the consumers that prices need not be as high as they are paying. I admit that pirates don't have associated development costs and therefore will always be able to sell for less but when you see a pirated copy of a movie for free and the real thing costs £16 ($30) you have to ask where the money is going.

    First off music/movie and clothing "pirates" are really different creatures. Clothing pirates actually produce a product and then try to leech off of someone elses good name to make a sale. Anyone can see for themselves that a handbag can cost less than $300 by going to Walmart. The bags there don't have the cachet of a Loius Vitton bag though.

    Your comments are even more ridiculous applied to music/movies. To say that a pirate has lower production costs is a rather large understatement. Producing a movie requires all sorts of expenses from paying actors, directors, stagehands, etc, to marketing. Pirating a movie requires the movie, a computer, and an internet connection. No mystery on how the pirate can "make" the movie so cheaply. Independent low budget producers/labels are a better example of how movies/music can be made more cheaply.

  • Growing concern? (Score:3, Interesting)

    by AutopsyReport ( 856852 ) on Monday January 09, 2006 @09:52AM (#14426818)
    This is a growing concern? Come on, counterfeiting has been around for centuries. Louis Vuitton and the 'LV' symbol which is so sought-after these days (usually through counterfeit means) was initially introduced as a counterfeiting measure to be printed on the bags/luggage some 100 years ago or so. Now it's one of the most popular fashion symbols known, and consequently, one of the most counterfeited brands.

    It was only a matter of time before counterfeiting struck its hand on the electronics industry. There's already counterfeit electrical parts, medical supplies, you name it. The thing is about counterfeits coming from China is that there are thousands of factories that can produce the exact same product easily. Factories are next door to each other in Guangdong/Shenzen -- getting the blueprints for products is only a matter of knowing someone from another factory and getting a copy for you to produce. So it may not be so much an issue as having a counterfeit phone, but having a phone produced in a different factory.

    The truth of the matter is, the '100% mirror quality' fake Louis Vuitton's that walk their way past you in the mall are impossible to tell from the real ones. The quality is the exact same, and the materials and craftmanship the same. So for small, (mostly) meaningless electronics, counterfeit does not impose much of a problem to the consumer. For health-critical devices or medicines, it's a different story. That's why there's so much more focus on stopping counterfeit medicine than Louis Vuitton.

  • by jmichaelg ( 148257 ) on Monday January 09, 2006 @10:12AM (#14426971) Journal
    Cisco is plagued by counterfits.

    If Cisco outsources the manufacture of the hardware how can it possibly believe that the manufacturer won't run an extra X copies off the line after they've run Cisco's? Sure, your contracts may prohibit that but when the cost vs what Cisco charges the end user is so great, the temptation for someone at the manufacturing line is going to be pretty high. Especially if they figure they'll sell the goods in a market where Cisco isn't.

    There are reasons on-shore companies used to do the manufacturing themselves. This is one of them.

    Outsourcing may be cheaper in the short run but Cisco is beginning to learn what the long-run costs are.

  • Deadly fakes (Score:3, Interesting)

    by SysKoll ( 48967 ) on Monday January 09, 2006 @10:23AM (#14427059)
    Fake Vuitton bags don't endanger anybody's live, they are just a rip-off. Of course, since the whole "elite brand" phenomenon is largely a matter of advertizing overpriced goods, you could just dismiss the problem as a parasitic rip-off riding the coat of a legal rip-off.

    However, fakes aren't stopping at clothes and fashion. The problem is that if you don't fight counterfeit very efficiently, you soon see them appear in places where reliability and traceability are paramount. What about bad components crashing a mission-critical system? Fake brake pads in your car that overheat and fail? Or even worse, fake antibiotics and aviation parts? All these are happening today and are a major concern.

    One way to fight counterfeits is to ship items with an RFID tag that is queried at each step of the shipping and traced back to the originating factory. Of course, pirates will soon start counterfeiting tags too, so the system has to be designed to prevent fake and duplicate numbers.

    I personally must be naive because I cannot conceive making fake drugs or couterfeit airplane parts -- could you endanger thousands of lives to make a quick buck? Obviously, such scruples belong to a gentler era, such as the Hun invasions.

  • Re:I don't get it (Score:5, Interesting)

    by darkith ( 183433 ) on Monday January 09, 2006 @12:03PM (#14427746)
    NiMH batteries are generally pretty safe. They don't really require any onboard electronics, just a peak detecting charger if they're being fast-charged. If shorted, they may get *really* hot or ignite adjacent materials, but they're not as reactive as lithium based technology.

    Li-Ion/Li-Poly cells are the dangerous ones. Basically they can reach a run-away condition very easily, and lithium is *very* reactive. They can ignite if punctured, charged too fast, over-charged, or if they drop below a certain voltage and are then charged at normal rates. They will also swell/burst if over-discharged or over-heated. Most Li-Poly/Li-Ion packs include a circuit with a thermal cutoff to prevent over-heating, a circuit to prevent shorting/excessive-discharge-rates, and a circuit that isolates the pack if it drops below a safe voltage (usually around 2.5-2.8 volts per cell).

    I did purchase a pair of Li-poly batteries for a cell phone, which were no-name imports. They did not have any cutoff circuitry, and I suspect could have been nasty if they wandered out of spec (either through abuse or a defective phone). I used them with no problems though, but I think I'd reconsider, given what I know now about Lithium cells.
    That said, the circuitry required for Lithium cells is becoming cheaper everyday (the functionality is avaiable in a single chip), so I wouldn't be surprised if "decent" third-party units do have the desired safety functionality.

    D.
  • by anticypher ( 48312 ) <anticypher@gm a i l . c om> on Monday January 09, 2006 @12:46PM (#14428181) Homepage
    There are a ton of counterfeit Cisco goods on the market, they all come from the same Flextronics plant in Suzhou, China where Cisco makes 40% of all its electronics. The cards are exactly the same as Cisco cards, but the firmware is sometimes different, and they are missing the official Cisco logo. They have the same part numbers as their Cisco counterpart. I'm pretty certain these are cards which failed QA/QC in the plant, and are re-sold without the Cisco logo.

    These cards are the bane of support people. When you yank a failing card and realise you can't call TAC, the customer is screwed.

    There are a lot of used equipment resellers in Europe with these cards and chassis, they come in through Rotterdam by the container load. You can pick up a non-branded, fully loaded 12008 for a few thousand euros, a 2811 for about 100 euros, and a palette of 1720s with ADSL WICs for 20 euros each. At those prices, you don't bother about TAC support, you just buy extras as spares and swap out anything that fails. The MTTF is usually under a year, so it's still Caveat Emptor.

    the AC
  • Surprise, surprise (Score:2, Interesting)

    by ajs318 ( 655362 ) <(ku.oc.dohshtrae) (ta) (2pser_ds)> on Monday January 09, 2006 @02:03PM (#14428947)
    So some companies can produce functionally-similar goods to famous brand names for less money. Big surprise. They haven't got the overheads like private yachts for fatcat directors and shareholders. If government propaganda is to be believed they do have alternative overheads like bombs and stuff. Maybe blowing up buildings is cheaper than blowing up the tyres of a Ferrari?

    Anyway, it's almost entirely the fault of the manufacturers of the "genuine article". If people are counterfeiting your products and still managing to make a profit selling them cheaper than you, then you obviously are overpricing them in the first place.
  • by pintomp3 ( 882811 ) on Monday January 09, 2006 @03:47PM (#14429920)
    i bet they weren't *real* laptops and mp3 players. most of the knockoff electronics are simply made to look legit, not function. i doubt you can make a functioning powerbook for much cheaper than apple. i remember my uncle brought me this "video recorder" once (long story about how he got it). it totally looked like a sony handycam. but when you pressed eject, the space was for an audio cassette. sure enough, i put in a tape and it played back the audio. in the front was a film camera. i'm not sure why they went through the time to design all of that. clearly this is not a case of "the only difference was the label". i've also seen a minolta slr that totally looked legit also, til i noticed the thumbwheel to wind the film. i agree that a lot of products, especially non-electronics are often simply label-whoring. but most electronics items don't have the mark up that prada bags do. btw, if you go to chinatown, you will find that the quality clearly well below the real ones. but a fake prada bag will still hold your stuff as well as a real one. that fake camcorder couldn't record video.
  • ball bearing fans (Score:2, Interesting)

    by loshwomp ( 468955 ) on Tuesday January 10, 2006 @12:25AM (#14433273)
    Back in the bad old days before you could conveniently mail order hardware, you went to the COMPUTER SHOW AND SALE at the local community college gym.

    I used to buy a lot of 80mm ball bearing fans, because the cheap-ass sleeve bearing fans that came stock in power supplies would always sieze up after 6-18 months. But often the ball bearing fans would wear out, too.

    A little surgery revealed that many of the supposed ball bearing fans actually had cheesy bushings, and the clever Chinese simply learned how to sell their cheap wares for more by slapping "ball bearing" stickers on them. Once, to make a point, I bought an $8 fan and immediately dissected it in front of the vendor with a pair of diagonal pliers. He just shrugged.

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