A major challenge in an innovation-driven global economy is counterfeit and pirated goods trade. The trade in fake products and goods is booming and hitting the sales and profits of the companies affected. It impacts governments, businesses in general, and last but not least the consumer. Revenues get cut and reduce economic well-being, health, safety, and security. Counterfeiting is a threat to sustainable business models based on intellectual property and patenting because they also discourage innovation and work against the economic growth that is based on it.
B2B electronics components and material
A common target for modern-day counterfeiters are B2B materials and components. Electronic components are fairly easy to duplicate cheaply using inferior materials and a lack of quality control. Some original equipment manufacturers (OEMs) purchase the components without authenticating the provenance and quality of the items.
A high profile example of deceptive counterfeit goods entering the supply chain is the US Navy Boeing P-8 Poseidon aircraft. The aircraft was found to contain counterfeit electronic semiconductors in the ice detection system, thus undermining a crucial safety feature that was fortunately detected during a test flight. Known as “chop-shop” electronics, counterfeiters refurbish old 1980’s and 1990’s computer hardware. They make electronic components such as microchips and integrated circuits that look like genuine parts with identical branding, but are inferior in quality.* If used in safety-critical applications, the consequences can be catastrophic and even fatal. Other examples of counterfeit B2B products entering the supply chain include some of the metal used on NASA satellites, plastic used in Aston Martin supercars, and components used in nuclear power plants.