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One in Five Mobile Phones Shipped Abroad Are Phoney (theregister.co.uk)

Nearly one-fifth of mobile phones and one-quarter of video game consoles shipped abroad are fake, according to a report by the the Organisation for Economic Co-operation and Development (OECD). The Register adds: The Trade in Counterfeit ICT Goods report, published ahead of the 2017 OECD Global Anti-Corruption and Integrity Forum this month, identified a growing trend in fake goods. Smartphone batteries, chargers, memory cards, magnetic stripe cards, solid state drives and music players are also increasingly falling prey to counterfeiters. On average, 6.5 per cent of global trade in ICT goods is in counterfeit products, according to analysis of 2013 customs data, that is up from 2.5 per cent of overall traded goods found to be fake in a 2016 report. China is the primary source of fake ICT goods, and US manufacturers are the worst affected by lost revenue and erosion of brand value, the report said. Almost 43 per cent of seized fake ICT goods infringe the IP rights of US firms, followed by 25 per cent for Finnish firms and 12 per cent for Japanese firms.

36 of 60 comments (clear)

  1. I'm surprised that it's only 20% by mykepredko · · Score: 4, Interesting

    When I was at RIM a few years ago, I was amazed at the number of different infringing products that came in through active searches of problem products.

    In terms of handsets, they ranged from cheap look alikes to incredibly similar "Blueberry" products (seriously, that was the name stamped with the RIM logo on the phone). For accessories (the group I was in), batteries, headphones marked as RIM products ranged from very good to better than the company was producing. There were some proprietary features (ie recognition circuitry) that should have been proprietary that were very expertly faked.

    I don't know how a global brand can combat this (and I'd be curious to see any ideas on how it could be done).

    1. Re:I'm surprised that it's only 20% by Anonymous Coward · · Score: 1

      Well there are ways of combating it, but it comes back to DRM.

      With accessories, it's a bit of a lost cause for chargers, but everything else can move to Bluetooth and USB-C and have the problem solved by doing a quick authentication. This is essentially what companies have been doing ever since Nintendo and it's lockout chip. You do a quick authentication to see if the other device says it's legitimate (basically the NES lockout chip just a form of entropy counting to a common clock) and then you push an instruction that is unique to the device and wait for the correct answer. If the correct answer is not forthcoming the accessory is essentially "frozen". The Printer/Ink people have been doing this for decades.

      With the actual fake phones (note the mention of Finnish (Nokia) ) in the article, these are almost universally Nokia phone batteries and chargers being counterfeited. In most cases the chargers are as good as or better than the originals. Batteries however, nearly every report of a battery fire is a result of a counterfeit battery or a counterfeit charger that lacked safety features.

      Which goes back to why counterfeits exist in the first place. >50% of the time people are looking for a deal, so they probably paid like $2 for a charger instead of like $60 for the original. In some cases they are produced in the very same factory, and the ones you find online are all the ones that didn't pass QA tests (mostly for cosmetic reasons, and were supposed to be destroyed. That is also what happens with counterfeit Nike shoes. They're produced using most of the same molds but the counterfeits are distinctly "more shitty looking" due to the mold wearing out.

      Just about every counterfeit item is a mass-produced item that lacks the quality checking of the authentic item. We probably wouldn't be as concerned about counterfeits if it wasn't for the fact that this is how toxic materials like Cadmium end up in the supply chain, and end up in childrens and pets toys. So a crackdown on the use of Cadmium in China by China would likely go a long way to removing a cheap source of metal. A crackdown on melamine would go a long way to preventing counterfeit food items ending up in the supply chain. Ans so forth. Clothing and toy counterfeits are the easiest thing to copy because the only way to prevent these things from ending up in the supply chain is to check every single package coming into the country, and having people in the Customs/Postal staff work with trademark holders to identify every single item, even those that look innocent. The "hoverboards" disasters would never have happened had every single one of those, counterfeit or not, been seized at import time.

      As for mobile phones, I think USB-C may ultimately solve the problem as the market for third-party chargers will vaporize, and accessories that are invalid can be blacklisted. For fake phones, well just look for the tells, multiple sim card support, look-a-like plastic, low resolutioni screen and so forth. Many of these generic "mp4" players from a decade ago look like ipod nano's, but they don't work very well at all.

      What ultimately saves Apple from counterfeits is the App store. Since a fake iPhone is always an Android device (where as 10 years ago, the fakes were mostly Nokia phones, identified by the wrong screen shape), When the iPhone fakes first appears, many of them had screens that looked like they had been sourced from old Palmpilot stock.

    2. Re:I'm surprised that it's only 20% by Highdude702 · · Score: 1

      So we just keep killing people? Because when you kill one billionaire another person becomes a billionaire. and the more you kill the faster it happens.

    3. Re:I'm surprised that it's only 20% by gordguide · · Score: 1

      So we just keep killing people? Because when you kill one billionaire another person becomes a billionaire. and the more you kill the faster it happens.

      So, you're saying if we keep killing the billionaires, then the natural outcome is sooner or later, you and I become billionaires?

    4. Re:I'm surprised that it's only 20% by Highdude702 · · Score: 1

      Until the horde jobbed with murdering us "rich folk" comes to lynch us..

  2. I knew it! by Nidi62 · · Score: 2, Funny

    That explains why my iPhone was always overheating!

    --
    The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil
    1. Re:I knew it! by n329619 · · Score: 1

      You're holding it wrong.

  3. Counterfeit vs. Fake by crow · · Score: 4, Insightful

    If the product really behaves as what it's being sold as, it's a counterfeit. If it doesn't, it's an outright fake. I once bought a micro SD card that turned out to be fake (it failed, and then the company said the serial number wasn't valid). When buying phone batteries on eBay, I expect them to be counterfeit. They've always worked, though I don't have any good way of telling if the mAh ratings were real.

    1. Re:Counterfeit vs. Fake by mjwx · · Score: 1

      If the product really behaves as what it's being sold as, it's a counterfeit. If it doesn't, it's an outright fake. I once bought a micro SD card that turned out to be fake (it failed, and then the company said the serial number wasn't valid). When buying phone batteries on eBay, I expect them to be counterfeit. They've always worked, though I don't have any good way of telling if the mAh ratings were real.

      However the collary to this is that there is a difference between "fake" and "not genuine".

      Many non-genuine products are just missing a brand. Bosch make oil filters for a number of auto manufacturers. The only difference between a Bosch filter and a Genuine BMW filter is that the Genuine BMW filter has a brand sticker and a huge markup. Its the same with many ICT products. Quite often the parts you buy were made in the same factory, sold off as excess and resold at a lower price than genuine components.

      OTOH, there are legitimate fakes, but they are much rarer than most are lead to believe.

      Personally I've never bought a fake component, unbranded ones designed to fit, but never a fake, but I also dont buy from random sellers on Alibaba.

      --
      Calling someone a "hater" only means you can not rationally rebut their argument.
  4. For some products, it's impossible NOT to buy fake by Nanoda · · Score: 4, Insightful

    When I replaced the battery in my Nexus 4 a few years back, I was convinced that _everything_ available was a fake (despite them all touting their "ORIGINAL", "GENUINE", "OEM", etc. status).

    I'd have paid 40$ or so for something from a clearly official source, but ended up having to settle for a 10$ China-shipped fake.

  5. Re:If It Works by KiloByte · · Score: 1, Troll

    These phones come from the same factories, the same workers, the same machines. Not paying the marketing fee is a pure win. In the past, the "non-counterfeit" products could at least claim to have superior quality control, but that has long since been sacrificed on the altar of profits (checking whether the product isn't utter shit vs an extra boat for an executive -- easy choice). Thus, fuck brands.

    Unrelated: the Stylish snippet needed since yesterday is:
    @-moz-document domain("slashdot.org") {
    article[class*="-sponsored-"] {display:none !important}
    }

    --
    The creatures outside looked from Alt-Right to Antifa; but already it was impossible to say which was which.
  6. followed by 25 per cent for Finnish "firms" by williamyf · · Score: 1

    Finish firms? You mean, aside from Nokia and their licensed pals (Like HMD, staffed by ex-Nokians) there are more finnish firms in this list? ;-)

    I mean, the submission is about Mobile phones, henceforth my curiosity.

    --
    *** Suerte a todos y Feliz dia!
    1. Re:followed by 25 per cent for Finnish "firms" by Keruo · · Score: 1

      Angry Birds is quite copied brand, so you could add Rovio to the list.
      There are other smaller companies who own certain mobile related hardware patents, for example Twig(former Benefon) but they have no means to pursue infringements.

      --
      There are no atheists when recovering from tape backup.
  7. I'm surprised it is not shipped from abroad by Roger+W+Moore · · Score: 1

    Are there really lots of US fake phone manufacturers shipping abroad...or is the problem that of fake phones shipped _from_ abroad?

    1. Re:I'm surprised it is not shipped from abroad by gordguide · · Score: 1

      Are there really lots of US fake phone manufacturers shipping abroad...or is the problem that of fake phones shipped _from_ abroad?

      One of the problems with the written word is it is subject to mis-interpretation by readers. I agree that the OP could have created a more concise and unambiguous headline, but it's also true that there is more than one way to interpret the words he did use.

      One, as you did, might interpret it to mean that the fake phones "were shipped abroad", that is, from here to there.

      Another, as probably the poster intended, was to indicate that the fake phones "were shipped abroad", as in they originated somewhere offshore with no mention of the final destination. Maybe it would be clearer if we substitute something for phones. How about, "A bunch of Americans were robbed abroad by pickpockets." Make sense now?

  8. Re:For some products, it's impossible NOT to buy f by swb · · Score: 1

    I think 18650 batteries on Amazon are like this.

    The only place I seem to be able to buy ones that seem to have the right capacity and discharge curve is the e-cigarette shop, the Amazon ones work but seem off somehow.

  9. Re:If It Works by Anonymous Coward · · Score: 1

    This is not true at all.

    Most of the counterfeits out there are QA fails that were supposed to be discarded, or a factory overproduced the parts, and some other factory inserted the guts of one device into the shell of another. (Look up some counterfeit hard drives, you'll get a laugh out of the 2.5" drive when taken apart is just a 4GB sd card and a paperweight.)

    Depending on which items you're talking about, counterfeits range from bad, to "almost passable". With phones, they're always "bad", but the accessories tend to be closer to passable. Like counterfeit chargers are big business, and they are made by stealing the worn-out molds to the OEM version and filing off the brand name and using them until they're useless. The insides may be mostly the same, or they may inferior, lacking safety features to save costs. Like I bought a "oem" charger for my phone and had no issue with it, but I left the one I considered fake at work and used the authentic one at home.

    The stuff that is "better" also tends to have it's own branding.

    Now, I won't knock all the stuff, sometimes there is an innovation to be had (like HDMI splitters that strip the HDMI copy protection, by accident) that makes a counterfeit more appealing, but in most cases, it's just people wanting the cheapest product possible.

    So any losses claimed by Nokia and such are directly attributable to using proprietary chargers to begin with. If they just went with USB (or now USB-C) to begin with, the market for counterfeit chargers for that device would disappear overnight.

    Counterfeits exist for three reasons:
    1) Original manufacturer does not produce the item any more (such in the case as aftermarket batteries, chargers, memory cards, tapes, cables)
    2) Original manufacturer does not produce the item at a price point justified. (See Xbox360 hard drives as an example), so customers feel justified in NOT buying from the original manufacturer.
    3) Counterfeit manufacturer wants to cash in on some hot product by producing much cheaper look-a-likes that only need to work long enough to walk away with the money. See things like the Retron5 (counterfeit NES/SNES/Megadrive) that is way overpriced. There are dozens of clone Nintendo systems, but they all use the same NOAC chips, and they all have the same defects. Then comes along the Retron 5 and basically steals open source software and uses a software emulator to get about 90% accuracy on a commodity ARM chip. Still doesn't support expansion chip carts. There are a half dozen counterfeit products that were produced in direct response to the NES Classic Mini, and they all play pirated games, but they don't play them very well (high input latency) where as the NES Classic Mini doesn't produce high latency input (but still more latency than a real system)

  10. Re:If It Works by DogDude · · Score: 1

    Ah, the Trumrian view of the world: "I've got mine. Fuck you." So pleasant.

    --
    I don't respond to AC's.
  11. Re:Free global markets != wonderful thing by Anonymous Coward · · Score: 1

    "atheist nation like China" ? or do you mean they don't believe in patents and copyright in the same way as the USA would like them to.

    Don't worry, just as soon as they have a patent portfolio large enough to use as a weapon in international trade disputes they'll find the faith. Lets see how long america keeps the faith after that point.

    Or do you mean that people of faith are more trust worthy? Cute.

  12. That's not very good by wonkey_monkey · · Score: 1

    They should all be phone-y.

    --
    systemd is Roko's Basilisk.
  13. Seems fishy by puddingebola · · Score: 2

    Frankly, this story seems fake so I'm just going to research it on my Samdung Black Hole 8 that I bought from a guy in front of the convenience store with a table.

  14. Re: Atheist [Re:Free global markets != wonde by Tablizer · · Score: 3, Informative

    and atheist (right and wrong aren't enforced socially in the same manner as Western countries)

    Hogwash! For one, China is largely Buddhist (or variations of), not atheist.

    Second, the USA started off industrialization in a similar poorly-regulated dog-eat-dog kind of way. Europe used to rib us about it. Poor people take more risks because they have less to lose. Read about "Muck Rakers". Tape-worm eggs were sold as diet medicine, for example, and nobody did anything about it.

  15. Surprise? by thunderclees · · Score: 1

    The PRC had a fake Apple Store selling knock-offs of Apple products with fake Apple employees who did not know they worked for Apple. Is anyone surprised when it is common knowledge that many of the facilities in the PRC that make this stuff often run between shifts where they use the same lines to make knock offs and that if a Chinese company wants something and has the juice in the CPC you better give it to them or your workers strike or you have a fire at the factory.

    Does anyone remember when IBM actually used to make PCs? Towards the end just before they sold out to Lenovo who was making them anyway they had a massive recall on a few on the desktops because they would spontaneously fail. This turned out to be caused by a PRC knockoff of a number of the caps used on the main board. The PRC and/or Foxconn's suppliers had stolen plans for the caps from a Japanese company but they had actually stolen a beta formulation and so the caps in these IBM desktops would leak and destroy the main board. This was probably a major contributor forcing IBM out of an industry it had created.

  16. Re: Fake (counterfeit) Consoles? by Highdude702 · · Score: 1

    to play games? lol you shouldnt be forced to have the internet to play games.

  17. Re: Atheist [Re:Free global markets != wonde by Highdude702 · · Score: 1

    I can not find what youre talking about. Can you link please.

  18. Re:Its not a fake... by MrKaos · · Score: 1

    I'm not having a go at Apple, its a play on words, a joke.

    --
    My ism, it's full of beliefs.
  19. Oh, I get it ! by swell · · Score: 1

    Phones / phoney - very clever play on words. My phone is very 'phoney'; it can make and receive calls all day long, but I prefer no calls when I'm sleeping. I feel bad for people whose phones are not phoney. But maybe they are satisfied if they do texts and Twittey.

    --
    ...omphaloskepsis often...
  20. Well, so they work? by iamacat · · Score: 1

    Good for them then. Probably cheaper and better localized than official Apple and Samsung.

  21. Re: Atheist [Re:Free global markets != wonde by Tablizer · · Score: 1

    Tape worms? Below is an article. Some researchers say the claims are dubious and that ads or labels mentioning tape-worms don't necessarily mean the pills actually contained tape-worm eggs. It could be a lie. But the fact some co's openly advertised it itself suggests lax regulation.

    http://www.philly.com/philly/b...

  22. Old News but thanks for the reminders ... by gordguide · · Score: 1

    [Old News but thanks for the reminders] ... since some people haven't got the memo, and then there are those that love the counterfeits simply because they are cheaper.

    This is an old problem, going on since before China became a manufacturing centre (ie prior to the Special Economic Zone creation of the late 1990's, and the full liberalization of enterprise in 2005 ... yes, it's only been 15 years since China didn't make squat besides t-shirts).

    The IEEE and AES have been warning about counterfeit semiconductors for years. That is, take a 10 cent transistor, sand off the markings, and silkscreen or laser etch new markings representing a higher performance device that sells for ... wait for it ... 20 cents. And this has to be done in batches of thousands, because that's the quantities these devices sell at.

    That's a lot of effort to make 10 cents per chip, less your production costs. It can hardly be a surprise that they would go for higher priced items given the opportunity.

    I dabble in electronics. These days you need a good, temperature controlled soldering iron, because lead-free solders are a pain in the ass to work with, and without high temperature capable irons, and precise temperature control, you will simply get either bad solder joints or burn out the component you are eager to install, rendering it useless.

    Now, the best soldering irons are made by a Japanese company, HAKKO. Weller makes some, a UK company called Antex is the preferred brand "over there" but if you are serious about the business, you use HAKKO gear. So, a nice temp controller unit and a nice iron with a few hundred available tip types is maybe $125 from them.

    The older model, the "venerable" HAKKO 936, which dominated the market for decades, is still a popular unit. Trouble is, it isn't made and hasn't been for about five years, But, you can still buy "brand new" ones in the usual places. How can this be, you ask? Two guesses, one doesn't count.

  23. most almost 100% copyphone is samsung now. by gl4ss · · Score: 1

    plenty of finnish brands are no longer finnish though. I presume the 25 is just nokia, angry birds and clash of clans. based on living in asia. Marimekko isn't getting infringed that much. h&m is(amazingly). Nokia recently not that much either.

    Samsung is the most counterfeited mobile phone manufacturer as such though. The copy the box and everything.

    HTC they will sell you a refurbished and reflashed one as a new phone(returns from euro market resold in asian market as new). I am not entirely sure how much htc themselves are involved in this to be honest though, but if you buy a htc online thats supposedly asian fw you might find out that it doesn't have online update working because it's actually a reflashed euro-board(which has mostly same support)

    --
    world was created 5 seconds before this post as it is.
  24. Re: Atheist [Re:Free global markets != wonde by Highdude702 · · Score: 1

    Seeing as I cant find that in any reputable source, im still going to take that with a grain of salt. and from what the story youre showing says the early 20th century didnt have a lot of too many "regulations" Im going to take this with a grain of salt, and not believe this until I can atleast find more information on it.

  25. Re: Atheist [Re:Free global markets != wonde by mjwx · · Score: 1

    and atheist (right and wrong aren't enforced socially in the same manner as Western countries)

    Hogwash! For one, China is largely Buddhist (or variations of), not atheist.

    Buddhism is by definition, atheist. Atheism is the absence of belief in a god (opposite of Theism, the belief in god or gods). Buddhism does not contain a god or higher power that controls everything. Buddhism is about the universe responding to what you do, whether you're resurrected as a higher or lower being depends on how you've lived your life, not what $_.Skyman allegedly says (lets ignore that every single one of his directives was written by the hand of man).

    Buddha was a man who, according to Buddhism, achieved enlightenment. Buddha does not control or influence from beyond the point of enlightenment and it's the goal of Buddhists to reach the same level of enlightenment. Buddhists religious texts are treated more like guides than unquestionable directives.

    Buddhism is not the only major religion to be atheist, and despite being rather non-authoritative compared to theist religions they have also been abused by those in power. That being said, I'd much rather sit next to a devout Buddhist than a devout Christian. Unwelcome proselytising is not the done thing for Buddhists (its a personal journey and all that). Buddhist being atheist is about the only thing the GGP got right though.

    Second, the USA started off industrialization in a similar poorly-regulated dog-eat-dog kind of way. Europe used to rib us about it. Poor people take more risks because they have less to lose. Read about "Muck Rakers". Tape-worm eggs were sold as diet medicine, for example, and nobody did anything about it.

    It wasn't just the USA, Europe was pretty messy too although we did it earlier than the US. The thing is, for Europe this was well over 100 years ago where we used kids to clean smoke stacks. For China, there are many people who remember when Mao told them to make steel in their back yards (which resulted in massive amounts of pig iron, which is too brittle for most applications requiring steel). Much like Europe and the US, China's middle class are rising.

    --
    Calling someone a "hater" only means you can not rationally rebut their argument.
  26. Re: Atheist [Re:Free global markets != wonde by Tablizer · · Score: 1

    Our nation started out with very few Federal regulations on food, safety, and medicine. It was either assumed to be a state-level issue, or lawsuits were assumed to be the proper way to settle disputes between consumers and suppliers.

    As mass manufacturing and cross-state commerce picked up, this gradually changed, often based on cases of nefarious practices. For example, law-makers realized it's not practical for the average consumer to test all their purchased food for pesticide residue.

  27. Re:Its not a fake... by MrKaos · · Score: 1

    ah say!, It's r iPhoney, suuun, a play orn wurds, ah say, a jowke

    ah made a funny suun and yor not laffing.....de de de de de de de dooo dah doo dah

    --
    My ism, it's full of beliefs.
  28. Re: Atheist [Re:Free global markets != wonde by Highdude702 · · Score: 1

    That still doesn't prove that any of that actually happened. Probably a wives tale of the time. As I said that article you linked is the only thing I can find on it and it's not real interesting so I'm not going to invest hours trying to find if to true or not.