Spotting Counterfeits
Detecting Bogus IT Products Can Save More Than Just Money

Article from Processor Magazine (3/16/2007)

Counterfeit IT hardware and software lurk out on the market, and the counterfeiter’s drive and sophistication are only growing. In fact, the U.S. Customs and Border Protection Agency claims that the number of high-tech fakes it seized more than doubled from 2004 to 2005.

Tips For Spotting Counterfeit Software
Even though software counterfeiters are constantly changing up their game, you can still take steps to protect your small to midsized enterprise from counterfeit software.

John Wolfe, director of Internet enforcement for Washington, D.C.,-based Business Software Alliance, a worldwide leader in combating software piracy and counterfeiting, cautions that when you’re looking for software, deal with only reputable vendors online and offline.

Counterfeiters use OEM software as the excuse for their low, low prices. OEM software is not available for reselling, regardless of what shysters and counterfeiters try to advertise. So never accept the OEM ruse as the reason for low prices that are just pennies on the dollar.

“If the price is too good to be true, it is,” says Wolfe. He also advises that you don’t rationalize away common sense when encountering a ridiculously low price on a piece of software. Poor packaging such as a simple sleeve vs. slick vendor packaging is another calling card of counterfeit software. Unfortunately, counterfeit software packaging can run the gamut to glossy boxes and cases that would put a software vendor’s marketing department to shame. Purchasing software is more than just purchasing the media; lots of development dollars and intellectual property are tied up in the development of the software.

The ultimate goal of software counterfeiters is to slip their counterfeit goods into a legitimate sales channel, and despite your best efforts, you may find something suspicious about your last software purchase. Wolfe advises, “If anything at all is suspicious, call the rights holder.” You can find contact information for the rights holder on the vendor’s home page.

Do your research about legitimate software prices both in your local market and nationally by visiting vendor sites for pricing information and using trade publications to track pricing on software and hardware you want to purchase for your SME. This little bit of education can work wonders to delineate the real software deals from legitimate vendors vs. counterfeit software that criminals try to foist on unsuspecting buyers.

Tips For Spotting Counterfeit Hardware
The same due diligence and common sense you exercise sniffing out counterfeit software applies to sniffing out counterfeit hardware.

“One common misperception is that counterfeit equipment is only a problem on the secondary market,” says Rick Stevens, vice president of marketing for Network Hardware Resale (www.networkhardware.com), a leading reseller of network equipment.

“In fact, as counterfeiters become more skilled, authorized resellers are increasingly vulnerable to fakes. An established, reputable secondary market provider will have an extensive inspection and authentication process and technicians who test and inspect thousands of pieces of equipment each year,” Stevens says. “This experience is the best defense against fake equipment. Buyers should ask their supplier, whether secondary market or authorized channel, to detail their quality assurance processes to ensure that nothing is taken for granted when it comes to authentication.”

Nick Pegley, vice president of marketing for Redwood Shores, Calif.,-based All Covered (www.allcovered.com), an IT services firm specializing in the small business market, says, “Generally, I’d recommend users buy from reputable vendors and avoid prices that are ‘too good to be true’ on the Internet—they probably are.”

Stevens says, “For the average end user, many tell-tale signs of counterfeit, such as subtle irregularities in external product design or internal components from noncompliant manufacturers are often too hard to recognize. But there are a few basic steps that anyone can follow to help spot suspect equipment: Confirm product serial numbers with manufacturer databases, inspect product packaging for standard manufacturer logos and similar packaging materials within boxes in a single shipment, and compare holograms to ensure consistency.”

In the end, common sense and due diligence are your best bets for keeping counterfeit software and hardware out of your SME.