Cisco sees need to clamp down on counterfeit products

http://gulfnews.com/business/sectors/retail/cisco-sees-need-to-clamp-down-on-counterfeit-products-1.1546595

Dubai: Counterfeit IT products and software are causing a great concern to the industry and the government and it is a challenging issue facing the industry, said a top Cisco official.

Rabih Dabboussi, managing director of Cisco UAE, told Gulf News, that fake products are often manufactured using substandard or unapproved components and can put Middle East customers’ networks at risk, leaving them exposed to performance, reliability, safety and security problems that could disrupt their business.

Counterfeit products and pirated software don’t have “valid software licences or manufacture warranties” and are ineligible for support services.

Quoting an Alliance for Gray Market and Counterfeit Abatement report, he said that as much as 10 per cent or over $100 billion a year of all technology products sold globally are counterfeits.

The US company had conducted five raids last year in the UAE by partnering closely with Dubai and Abu Dhabi Police and has seized over 1,000 high- and low-end counterfeit Cisco products worth around couple of million dirhams.

“How many fake products exist in the market is that something we don’t have a visibility on,” he said.

Lieutenant Colonel Omar Hammad Al Nuaimy, Deputy Director of Economic Crimes Department at Dubai Police, said that the illegal sale of counterfeit IT goods is not just a problem faced by Cisco but a “widespread problem” in the Middle East IT industry.

“While we understand that it is tempting to buy technology at very low prices, the potential costs that go with the risk of receiving substandard products are simply not worth it,” he said.

Dabboussi said that the law enforcement officials and the customs, government in general, has been extremely helpful and crucial in raising the awareness of the dangers and the negative impact to the economy.

When asked how tech companies can combat the fake products issue, he said that foremost is to educate the companies of the impacts of using a less expensive alternative rather than sourcing a new product, and there are company-certified refurbished products that come with warranty for customers who go for cost advantage.

According to the World Customs Organisation, total global counterfeit market is worth around $600 a year, seven per cent of the total world trade.

He said the minimum penalty for using counterfeit IT products is Dh250,000 and up to a maximum of Dh1 million fine and/or two years in jail.

“We think the penalties are insufficient to combat the piracy issues and it should be reviewed as a malfunction can present situations that cause mission failures and health or safety concerns,” he said.

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