Fear the Clone
Audacious copycats are already inflicting serious damage on the industrial sector, but when plagiarists become competitors, companies risk losing everything. What is the answer?23 Apr 2016
Product piracy and IP theft are among the greatest challenges to the industrial sector today. In 2014 alone, German customs officers seized six million products with a total value of almost 140 million Euros . Roughly 70 percent of companies in Germany are affected by product or brand piracy, according to the German Engineering Federation's (VDMA) most recent study . The estimated damage: almost eight billion Euros every year.
Reverse engineering plays a key role in this. "Pirates can often replicate unprotected machines in just a few weeks," says Bartol Filipovic , who is developing counterfeit protection mechanisms at the Fraunhofer Institute for Applied and Integrated Security (AISEC) in Garching.
Data thieves steal expertise
However, outflows of expertise and industrial espionage help counterfeits reach the market ever faster, even simultaneously with the original. And the phenomenon has not reached its peak yet: Increased networking and the Internet of Things are creating more and more weaknesses for hackers to exploit and steal information. "Many existing devices are connected to networks, but were developed with technologies that are not designed for the Internet of Things," explains Prof. Claudia Eckert, Head of AISEC.
She adds that small and medium-sized companies in particular do not realize the impact this has on their internal processes or market position, as their products had been operating in isolation until now. "Now they are faced with the challenge of incorporating these risks and enhancing their security management," says Prof. Eckert .
Germany, a nation of forgers?
The counterfeiters don’t all come from the Far East or countries with questionable legal systems. According to the VDMA study, at 23 percent, Germany itself is second on the list of countries of origin for counterfeit products, behind the People's Republic of China. In most cases, the fakes are made by competitors, who simply jump on their rivals' bandwagon – causing them harm. Generally, the knock-offs are not as high-quality as the originals. Many of the companies affected only learn of the forgeries when they receive complaints from customers who believe they have bought their products.
Or, and that is an even bigger problem, the copy is even better, more durable or versatile than the original. Then manufacturers not only risk losing sales revenue, they also face direct competition and potentially even a struggle for market position.
Technology to the rescue
That is why over 80 percent of companies choose to register industrial property rights such as patents or trademarks to protect themselves against forgeries. However, the protection afforded by IP laws is limited.
For this reason, more and more companies rely on technical aids to make counterfeiters' lives more difficult. Whether RFID-marked products (e.g. by Pepperl&Fuchs , Hall 9, Stand D76), processed microparticles ( Nanoinitiative Bayern , Hall 2, Stand A52) or fluorescent materials (e.g. by Polysecure , Hall 2, Stand A18) – the methods are as diverse as the range of forged products.
Focus on the product piracy
At HANNOVER MESSE, the Product and Brand Protection area will present a wide range of technical solutions as well as other information on protecting against piracy. The neighboring Industrie 4.0 meets the Industrial Internet Forum will also focus on IT security, product and protecting IP in various presentations.
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