In some cases if you can get to the devices underlying poerating system, you would be able to see it tying itself in knots trying to find missing or ill configured parts of 'clone' system but identify them as the real device.
There is a big stink with Chinese tablet computers at the moment, where one company produced a model, but then multiple companies ripped the hardware and software.
To make matters worse, some of these companies used substandard parts or re-furbished components.
Part of the thread can be seen here:
But as I say... once you get into the underlying operating system you can see many of the issues related to why these devices are going bad.
So really even in this field there are companies operating at multiple levels with no real hard and fast rules as to how you can identify 'fake' products.
It is clear that most of the counterfeits are actually result of the excessive inventory maintained in the EMS or the technology stealed by the people inside the EMS companies. But the third case looks interesting where the recycled components are collected and made as a finished product. But where do the people develop the software for these devices. Is these devices contain a different software and applications but look just similar to the original goods?
For finished goods, I think there is a way for an OEM to sell less-than-perfect products without damaging the brand: outlet stores. In my area, we have a Sony outlet and they sell last year's model at a discount and they sell refurbished products at a steeper discount. Customers know what they are buying and, in fact, Sony provides an extended service program at a pretty good rate. I've bought both year-old and refurn products there and I'm happy with both. Even Bose has an outlet in the same mall.
At the component level, I think it's a different story. I can't see vendors selling "seconds" at discount rates. Because of the volumes that pass through the channel, even a slightly higher failure rate in a batch of components is risky. Every component on a board is designed in for a reason, so a single component can make or break the end product. When it comes to components. I think one has to guard more carefully against counterfeits and against the risk of less-than-perfect products.
I believe some of us are missing the point regarding counterfeits. It is one thing to buy a fake "you name it" and know you are doing so. It is quite another to buy something you believe to be a legitimate product or component only to later find out it is not real and a sub-par device. It causes industries to put in place expensive priocedures for every component they procure to ensure it is legitimate. It adds cost to the entire system; costs that legitimate suppliers must also bear in order to reassure their cutomers their parts are real.
I think the problem here is not so simple. Even if the companies could come up with cheaper versions of their products, it would end up destroying their reputation. If every other person starts carrying original Apple's iPhones, they would certainly become less valuable. The novelty is one factor that makes them so desirable for consumers.
Also at some point companies like Apple, as you rightly mention, will need to compromise their assumption of high quality/price - exclusive market in favor of reasonable quality/price - broad market. Maybe, they choose not to accept the profitability of this but the sheer volume connected to it can outweigh every other strategy. This is exactly what companies like Micromax have achieved in India.
Backorder, Absolutely. This is a reality in the market and many companies are already responding with products that scale down the market. However, what people who buy fake products want is something as close to the original as possible minus the high cost, two things original equipment manufacturers cannot offer them and still make the same profit. For instance, Apple is unlikely to start selling iPods and iPhones that mimick the original but are not quite the original just to attract the consumers who buy from the gray market.
You are right, though. OEMs tend to encourage the proliferation of products that don't quite make the grade by adopting policies that literally stiffle the market. Let's go back to Apple and its iPhone again. The company sells the iPhone in the US currently to only one service provider AT&T. Forget about gray market buyers in Asia or Africa, if I want the iPhone in the US and I don't want to sign up with AT&T, I am forced to either buy a new one from Apple and then find a way to "jail-break" it or buy from the "gray" market. Those are my options or stay away from Apple products!
Tired of reading all the gray and black market stories, I have a question for all invoved in the industry. People who are buying the counterfeit cellphones are aware that it is not a genuine product. Generalising this, every link in the supply chain is ready to accept the gray nature of his source only because of some advantage! Is it not time then for the authorized sources and original manufacturers to re-evaluate strategy? If you are worried about all the people who are buying a clone of your product knowing very well that thee product willl not meet the quality standard set originally, is there not a case for making market targeted products? In countries where you can not stop them from hurting your interests with public and govt. support, you have to become one of them to ensure survival. Maybe a little far fetched, but well worth stepping back and strategising!
The China government is not as 'Gung-Ho' about E-waste , as you would imagine or you might have heard.
Specifically becuse with several Billion people, they already have a bit of an 'E-Waste' problem, without actively making it worse by importing other Countries E-waste.
There used to be a problem with other countries using China as a cheap dumping ground for all sorts of waste , but if you can imagine being a customs official your not really going to want to deal with a load of plastic' toxic' waste.
A taraf structure exists on goods re-entering China , specifically becasue the rubbish merchants tried several systems including setting up dummy factories to accept 'valuable' waste, in reality it was just an exercise to get the crap into China then abandon it.
So now there is a tax system , any return goods have to be reworked and out of the country within 30 days, after which a sliding customs tax takes over, plus you need special paper work to bring 'rework' goods back into China.
Don't think for one minute that the Government has any interest in turning China into a dumping ground for every toxic asset in the world, there is no long term future in that.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.