HP sets sail for war against printer pirates

Full steam ahead: HP's anti-counterfeiting programme is appealing for people to report their suspicions

As margin wars batter the troubled print market, HP has been quietly working behind the scenes to ensure VARs get consumables of the quality for which they have paid.

Counterfeiting of print consumables, such as ink and toner cartridges, is rife around the world, with emer­ging eco­nomies the focus for criminal gangs that see fakes as a relatively easy and safe route to profits.

Tina Rose, anti-counterfeiting programme manager at HP, said the channel should be wary.

“We just finished our Q2, and saw more than 900,000 counterfeit items from EMEA, items that are ready to sell as well as sheets of security labels, boxes and the like,” she said.

“Products found in the Middle East or outside Europe often bear labels indicating they are being sent to the UK, or Germany, where prices for the products are relatively high.”

She said that HP’s anti-counterfeiting programme has found 3.4 million counterfeit items and conducted more than 2,500 company audits in the past 18 months, including re­sellers. In Western Europe alone, 180 audits were performed, unear­thing some 50,000 counterfeit items stocked in legitimate warehouses.

“When we launched our auditing programme, channel firms said, ‘You won’t find any’. We have found many, although 96 to 97 per cent of partners do pass the audits,” said Rose.

Victims of piracy
Rose added that many people wrongly think piracy is a victimless crime. Not only do counterfeiting gangs often use illegal or even trafficked labour working in sub-standard conditions, but the products themselves often work poorly or are even dangerous to the user.

Rose said that businesses and resellers generally buy fakes unwittingly, thinking they are getting a good deal. They are sold as genuine, and the price difference is probably only five to 10 per cent – because large price differences would alert even the most credulous customer.

“Most do not work well; many sellers will put anything cheap or toxic into the mix that looks like toner, dust or ink, some of which you would not want on your hands or clothes,” she said. “They improve the packaging, and keep the price just a little lower than what you would normally pay.”

She said that substances used might not work within the HP chassis, or only work for 100 pages before failing or jamming the machine. Then customers simply have to buy another one, voiding any potential savings. If the printer is damaged, which can happen, they may need to buy a new machine. And non-genuine consumables can invalidate the warranty.

“Obviously, counterfeiters are not involved with recycling,” she added.

Both partners and vendors should stay on the lookout for red flags that could suggest a supplier’s offer should be scrutinised more carefully, such as unsolicited internet or email offers from suppliers that you have not worked with before, according to Rose.

She added that cash-on-delivery terms, deals with people with no verifiable business address, or bulk sales of ‘original HP cartridges’ for example, offered via a business-to-business online platform should also arouse suspicion. Although such offers could be quite legitimate, these are also counterfeiting tactics that might be used.

Exercise caution
Be cautious, especially when canvassing new suppliers, said Rose. Those with which you have a track record of receiving reliable, genuine product may be trustworthy, but new ones may not be so honest, or may be sourcing forged items themselves without knowing.

“Send us a digital photograph of the product, as we can generally tell right away whether it is legitimate,” said Rose.

She added that counterfeit product may be buried in a consignment, so do not just grab the first package you see for analysis when you open up a delivery. Anybody with suspicions can contact HP by telephone, email or online anonymously at:
https://secure.europe.hp.com/h41111/anticounterfeit/uk/en/form.php.

HP also published a detailed Anti-counterfeit Guide for HP Business Partners in January.

“You will receive a response within 48 hours. We don’t care where the information comes from, as long as we get it,” said Rose. “We will respond to every tip-off we receive, and it might take six months, or a year, but we will look into it.”

Although the recession did not spur­ an increase in counterfeiting, it is still going on and schemes by HP and other vendors, sometimes in collaboration with police and other authorities, are proving effective.

One of the largest recent UK seizures was of 1,800 counterfeit cartridges received by Customs at Manchester Airport in September 2008, added Rose.

Richard Allison, head of the IT distribution channel at Ricoh, said that counterfeiting is more prevalent in certain industry sectors.

“We are quite lucky because we are not experiencing too much of it at the minute. With our MFDs and copiers, they tend to be locked down with cost-per-page type deals,” he said.

Whole-of-print, services-led contracts that include consumables mean customers buy fewer consumables outside the contract – offering less opportunity to counterfeiters.