Fake smartphones have become a global plague, report the International Telecommunications (ITU) and the EU Intellectual Property Office (EUIPO) in a study released today that outlines the economic scale and non-economic impacts of smartphone counterfeiting.
An average of 12.9% of legitimate smartphone sales world-wide were lost due to counterfeits in the market in 2015 – a figure that was somewhat smaller in the US (7.8%) and the EU (8.3%), but markedly larger in other countries and areas including China (15%) and Africa (21.3%). World-wide, counterfeiting affects legitimate smartphone sales to the tune of 184 million units, or €45.3 billion in sales, annually.
The report, although entitled The economic cost of IPR infringement in the smartphones sector, also summarises the consumer risks and other non-economic damage that results from counterfeiting, including:
- Lower quality of service
- Safety hazards from defective or inadequate components or materials
- Cybersecurity threats
- Risks to digital transactions
- Jeopardised consumer privacy
- Lack of warranties and other consumer protections
- Environmental and consumer-health risks due to the use of hazardous substances in manufacturing.
The ITU’s Telecommunication Development Bureau Director, Brahima Sanou, said: “Counterfeiting affects economic growth as well as consumers’ health. I am pleased to see that our collaboration with EUIPO helps to raise awareness about the social and economic consequences of counterfeited smartphones. It is our responsibility to take steps to protect consumers.”
EUIPO Executive Director António Campinos said: “At the EUIPO, through our reporting and analysis, we are building a picture of how counterfeiting and piracy affect key economic sectors. This is our first report in this series which analyses a sector both inside and outside the EU. Its estimate that 12.9% of legitimate sales of smartphones were lost globally in 2015 can act as a powerful message for policymakers, and all who work to combat counterfeiting worldwide.”