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Publication Date: 07/1/2010
Archive >  July 2010 Issue >  Partnering > 

Getting Pro-Active With Counterfeits

OEMs, CEMs and Independent Brokers are Partnering with ISO Certified Test Labs like Electro-Comp to Significantly Mitigate their Risks and Vulnerability from Purchasing Counterfeit Products. The numbers are staggering. Counterfeiting is widely perceived as a growing problem, but have you seen the statistics? The Bureau of Industry and Security's (BIS) Office of Technology Evaluation (OTE) did a study in which 387 companies and organizations, representing all five segments of the supply chain participated, between the years 2005 to 2008. The findings revealed that 39 percent of those companies encountered counterfeit electronics during the four-year period. Furthermore, they found that an increasing number of counterfeit incidents were being detected, rising from 3,868 incidents in 2005 to 9,356 incidents in 2008.

Since 2001, in fact, the frequency with which counterfeit parts have been found has increased many times over. Fake components may have once have represented a very small percentage of all components sold in the gray market, but they now represent a much more significant fraction. The IPC® - Association Connecting Electronics Industries released the findings of a study in 2008 which estimated that a stunning 13 percent of components sold in the secondary market were counterfeit.

According to the Alliance for Gray Market and Counterfeit Abatement (AGMA), a trade group founded by Cisco, HP, Nortel, and 3Com to combat illicit trafficking in their products, perhaps 10 percent of the technology products sold worldwide are counterfeit, representing revenues of around US $100 billion.

$250 Billion in Damage
The U.S. Patent and Trademark Office estimates that counterfeiting and piracy causes damage about $250 billion (750,000 jobs) to the U.S. economy and it is higher than the GDP of more than 150 countries. The cost to industry in terms of product failures, and in some cases, national security risks is much, much greater. Typically, counterfeiters take older, slower speed grades, and/or different temperature range devices of the same part series, or an alternate part with the same functionality, and remark it to be "exactly" what the customer wants. This problem has become more prevalent now that so many chip makers are on allocation due to shortages. End user desperation, born of looming production deadlines, has created a clamor for parts delivered today, not 6 months down the line. This urgency has created a lot of overnight component brokers popping up in Asia and the rest of the world to take advantage of these shortages. As a result, remarked and counterfeit products have been more prevalent in mainstream supply chains, increasing the risk to end users now more than ever. If companies are not careful, they can find themselves with a much larger problem than just the shortage of a specific part needed for current production.

So how can you tell the difference between a genuine and counterfeit part? The reality is that even some of the world's largest OEMs and CEMs are not equipped and staffed to be able to tell the difference between a genuine part and a device that has been remarked. The result is that many of these companies are using ISO Certified Test Labs like Electro-Comp to mitigate their risks from purchasing counterfeit products. There is also much that each organization can do internally, having the QA department work to significantly mitigate vulnerability. We recommend implementing IDEA standard IDEA-STD-1010-A ( and SAE standard AS5553 ( standards into your organization's inspection procedures. Using these methods, a trained eye will be able to identify many red flags during incoming visual inspection and make a determination whether the lot be accepted, rejected, or sent out for further testing and authentication. Since testing can be very costly, a good visual inspection will help reduce unnecessary costs and wasted time.

Testing Parts
Aside from external visual examination, other counterfeit avoidance methods include X-Ray, decapsulation, and electrical testing. It is important to note that you should not pass a lot based on just one of these methods without the other. It is not uncommon for parts to pass one or two of these tests but fail the other(s). When used in conjunction with one another, these tests can provide convincing evidence whether a suspect part is counterfeit or not.

Sourcing a part in the open market is a daunting task, even for the most experienced purchasing agent. We believe that the next 5 years will not be the same as the last 5 years, and companies will start to require test documentation prior to accepting parts from a broker. Most companies aren't aware that they can partner with a test lab such as Electro-Comp Services to determine history on specific devices, or have a product tested before they purchase it. Legitimate suppliers will oblige if you make it a requirement. Currently, such front line services are rare, and buyers are left to fend for themselves, having to rely on suppliers who aren't providing any documentation that proves the parts they are selling are genuine. This can lead to a shortage for production and even turn into a full production shutdown because of board failures.

Testing and Programming
Component testing is a must in today's electronics industry. Increasingly, counterfeit components present a problem. You need security, and Electro-Comp Services, Inc. can provide that assurance.

Electro-Comp's In-House testing lab is quality-certified and equipped with the latest technology, ensuring that you are provided accurate and reliable analysis. For more information, read about our component testing options or if you need help an Engineer can assist you in selecting the right test for your needs.

Electro-Comp provides functionality test and parametric test for digital components, linear components, and discrete components. It provides Group "A" electric test and internal visual inspection for decapsulation as well as a radiography analysis. Other testing includes, solderability test, permanency test, co-planarity verification, and RoHS compliance.

In addition, the company can program EPROMs & EEPROMs, microcontrollers, flash memories, PROMs, SRAMs & DRAMs.

Electro-Comp is UL Certified as an ISO 9001-2000 test facility as well as ANSI ESD-S20.20-1999 certified by the ESDA. It is a Woman Owned Small Business, DoD Registered, Cage Code 4WHL8, and is a DSCC Certified Test Lab. It is a member of CACP, SIA, ECA, JEDEC, IEEE.

Contact: Electro-Comp Services, Inc., 3634 131st Avenue North, Clearwater, FL 33762 727-532-4262 fax: 727-532-4122 Web:

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