Uchendu Amuta writes that the rapid growth of the Information Communication Technology (ICT) sector came with the dumping of very poor quality computer and mobile phone accessroies in the country. He prays that the fresh government initiative to deal with the issue of substandard IT products yield the desired result. ?
Rapid growth in the nation?s Information Communication Technology (ICT) market over the past decade has thrown up various challenges in the market. One of such is the abundance of fake and substandard goods and accessories; a situation that has eaten so deep into the fabrics of the sector and may destroy it if unchecked.
The influx of fake and substandard products cut across all market segments of the sector. From telecommunications to computers/laptops, software to CDs and other accessories, the menace has assumed alarming levels. Who bears the brunt? Genuine equipment manufacturers, network operators? consumers and the economy in general, all are prone to the evils associated with the sale and usage of fake products in the sector.
The combined efforts of the two regulatory agencies, the Nigerian Communications Commission (NCC) and the Standard Organisation of Nigeria (SON) appear to have done little or nothing in checkmating the continued influx of such goods.
One can only hope that the recent effort by the federal government through SON by setting up a special task force against substandard products yields the desired result. The task force established in conjunction with a private firm, Christabel International Company, should by now gone into action as it work is billed to start in the Federal Capital Territory (FCT) and environs from June 5, 2013.
The damage done to the economy by fake products could only be imagined. Joseph Odumodu, the director general of SON disclosed recently that Nigerians waste over N500 million on purchase of substandard electric bulbs annually, adding that the bulbs barely last for two hours instead of the expected 1,000 hours. If this is lost to just fake bulbs, Nigerians imagine the colossal loss on all the fake products combined.
GSM handsets and accessories
GSM handset boom bust came alongside rapid growth in the telecommunications market that started in August 2001 with the introduction of Global System for Mobile communication (GSM) in the country. The digital mobile phone service almost immediately opened up the handset market
The handset market is very huge, estimated at over N500 billion. It is also estimated that more than 50 per cent of phone users in the country must have replaced their handsets more than once and 25 per cent of users own two or more phone handsets.? Phone users are in excess of 116million in the country currently.
Unfortunately, fake/substandard handsets have taken over this huge and potential market. World biggest phone manufacturers such as Nokia, Samsung, Motorola, BlackBerry, Sony Ericsson, Phillips, Huawei, ZTE and LG, alongside other names are imported into the country with the fakes overshadowing the genuine ones.
The influx pushed NCC to up to date type approve over 57 handset models as qualified to be used? for the Nigerian market. The commission empowered by the Nigerian Communications Act 2003 to establish and enforce standards for all telecommunications equipment in operation in Nigeria to ensure that they operate seamlessly and safely within the country?s telecom environment.
Consequently, all equipment manufacturers, vendors and operators, including customer devices such as mobile phone handsets must ensure that their equipment conform to the applicable standards as mandated by the commission before they are brought into the country.
However, the regulation has yielded little result as a large number of mobile phones that are not type approved by NCC and mostly substandard continue to find their way into the market.
The same goes for phone accessories such as chargers, batteries, memory cards and external speaker phones.
Before they can be sold in each market all models of genuine phones are tested to ensure they are safe for users, including testing to make sure they meet national and international standards for exposure to radiofrequency emissions.
All mobile phone batteries and chargers must undergo the same stringent testing to ensure they meet all levels of safety. Genuine mobile phone batteries are tested under intense conditions to ensure they can handle varying conditions of use.
Fake and substandard mobile phones, batteries and chargers on the other hand are not subject to such comprehensive testing and therefore the safety of fake phones cannot be verified or guaranteed.
Media reports world-wide indicate incidents where mobile phone batteries have exploded and injured people. Upon investigation these incidents have been linked back to the use of fake or sub-standard batteries. Fake and some third party manufactured batteries do not meet all of the safety requirements that prevent these incidents.? Non-genuine batteries may not have safety circuits which regulate voltage, current and heat within the battery and without these the battery can short circuit and explode or heat up and burn people.
Experts further disclosed that fake phones, batteries and chargers are made from cheap substandard components and may contain chemicals, which are dangerous to the environment and human health.
The cheap and low quality components used to manufacture fake phones and accessories are untested, uncertified and can be a safety hazard for users. The substandard components in fake phones often malfunction with the potential to injure users and damage property.
Fake phones can also contain dangerous chemicals and metals, such as lead and mercury. These are associated with a range of adverse health effects.
The poor performances of the handsets mostly imported from China have made Nigeria becoming a dumping ground and one of the biggest destinations of fake phones in the world. Experts posit that porous borders and the penchant for cheap, flashy products by Nigerians are major reasons for the market.
Since such handsets bribe their way or come through unofficial channels they rob the country of tax revenue aside many other dangerous consequences. a stress the network through weak signals and irregular performances, come with health hazards including electric shocks, are not durable and are sort of financial stress on Nigerians.
Most importantly, the market constitutes a huge disincentive to genuine investors into the GSM handset market. This may well explain why despites huge market and potential, no handset maker is attracted to establish even an assembly plant for GSM handsets in the country.
A source at Computer Village in Lagos where the bulk of these sub-standard and fake phone handsets are sold confided on ManufacturingToday that such phones do not emanate from genuine factories of the brand owners. According to him, what most importers of that category of phones do is to collaborate with some factories in China and India to mass produce hot brands in the country with specifications below what obtains in the original in order to minimize cost.
?Such phones even sell faster than the original ones because they come far cheaper than those from original manufacturers. In some cases, they sell the phones to unsuspecting customers as original?, he explained.
Renowned makers such as Nokia are not sleeping over the issue. Worried by the flooding of fake mobile handsets in Ghana and other West African countries, Nokia has since launch a campaign to fight the menace of fake phones. Nokia?s General Manager, Sales, for Ghana and Senegal, Ludovic Falcuo disclosed that the main objectives of the campaign is to highlight the health and economic implications of using a fake phone.
??Fake mobile handsets were often manufactured from substandard components containing dangerous chemicals such as lead mercury, and did not meet safety standards. They do not carry? International Mobile Equipment Identity (IMEI) codes and could not be tracked by network operators, they were widely used in terrorist activities??, Falcuo stated adding that Ghana alone losses about $20million annually from illegal importation of fake mobile phones as importers avoid payment of taxes and levies on the handsets.
This ugly development has also caused the Lebanese government to implement this year measures to render illegally imported phones unusable, as over 70 per cent of phone in country came in illegally. The crackdown will allow only phones IMEI codes registered at the Customs department to access the networks of state-owned telecom company. This same measure could be implemented in the country.
Software, CD and accessories
Written programs, procedures or rules pertaining to the operation of a computer system that are stored in read/write memory are regarded as software. It is an intellectual property that requires huge investment to make, so faking is not only an economic crime, the usage of fake software also predisposes computers and IT networks to danger.
Faking in software is commonly known as piracy and the serious nature of the problem explains why governments all over the world set up agencies to checkmate it. Here in Nigeria, this function lies on the door step of the Nigerian Copyright Commission (NCC).
Despite NCC efforts, pirated computer software, CDs, DVDs, music, movies, daunt the streets in the country. This has assumed alarming levels that right owners are now crying for help. The main attraction for users of pirated computer software and other products is also cheap pricing.
According to a recent study by Microsoft and the International Data Corporation (IDC), usage of pirated (fake) software portend great dangers to the users and businesses as a result of high exposure to infections by unexpected malware that can utterly destroy the computers.
The study reveals that consumers will spend 1.5 billion hours and $22 billion identifying, repairing and recovering from the impact of malware infections, while global enterprises will spend $114 billion to deal with the impact of a malware-induced cyber-attack resulting from the use of pirated software.
In the country, there are various versions of pirated software, computer discs (CDs), music and fake accessories such as mouse, memory cards, USB sticks, and the list goes on.
?Pirates are in every industry and this can constitute a clog in the wheel of the organization??, says Gozie Onumonu, head of Piracy Multichoice Nigeria, a pay TV service provider.
According to Onumonu, in 2004 Multichoice had over 5,000 subscribers on their platform in Onitsha, but as at now it is less than 500 subscribers, arguing that this shortfall can be attributed to the activities of pirates in the country.
He posited that there is a wrong perception about intellectual property (IP) crimes in the country where piracy is not seen as a hard crime and perpetrators are treated with levity.
This is not the case globally as the World Intellectual Property Organisation (WIPO) strives to see that intellectual property rights are observed and respected worldwide.
Experts are categorical in their opinion that respect for the rule of law contributes to a strong IP rights culture, which is essential in spurring innovation in local economies. An increase in legitimate technology businesses can add revenue that supports a country?s government programs and other infrastructure goals, creates jobs, increases profits for the broader industry, and helps create a strong business ecosystem.
Electronics
At the Alaba International Market, it is business as usual as over 80 per cent of the products in the market are fake and substandard.
Charles Okonji, expresses concern about lax regulation and the inability of customers to get value for their money.
The impact of the war against fake and substandard products seems to have eluded the Alaba international market following the revelation that 80 per cent of the products on display are either fake or substandard and this has been so for years. Many Nigerians have had bitter experience in the hands of these dealers in the past and everyone is concerned about the present situation.
Though, the Director General of Standards Organisation of Nigeria, Joseph Odumodu had earlier said that SON was determined to further reduce the prevalence of substandard products from its current level to about 30 per cent in a short period hence? through the? e-products registration.
Going by the words of Odumodu, the e-product registration scheme was to cover products that are already in circulation in the market, including electric bulbs, stabilizers, tyres, electric fittings, generators, building materials, cable, television sets, computers, phones, IT equipment, lucks and keys, cement, paint, agro-allied products and toys, but the effect has not been felt despite the huge resources that have gone into the exercise as substandard products are still prevalent in the market.
In a recent research carried out by ManufacturingToday, it was discovered that every original electronic product in the market has its corresponding fake. This means that out of every 10 products in the market, two are fake.
The traders import these fake goods and place stickers, trademarks and labels of original products on the fake items. This act was to enable them sell the fake products at good price, though far cheaper than the rate at which the original of the same brand goes for. The common reason given for this act of faking was that the middle and low class consumers prefer those cheap products irrespective of the quality.
Major dealers of specific electronic products have explained that the unscrupulous act is being perpetrated by traders who are not accredited agents of manufacturers in the market that operate small shops. This is because they do not have name to protect and they are not representing any company, hence no warrantee is given on any of the products sold. But the accredited dealers of these products and manufacturers? representatives sell original products with warrantee.
Also, in an interaction with some of the small shop owners, it was revealed that the reason behind the act is that when they stock their shops with the original products that are more expensive, their money would be tied down for too long and may lose its value. So they keep stocking both the original and fake products with the intention of explaining to the consumers, the value of what they intend to buy. Moreover, this means that the choice of what quality of product to buy is left with the consumer.
One of the dealers confirmed that all fake products were imported from China. That means that SONCAP has not been implemented; though SONCAP was a policy introduced for these products to be tested at the point of import to check the substandard products.
Consequences of adulterated fuel
Adulteration of transport fuel, which is currently a very flourishing business in our country, can lead to economic losses, increased emissions and deterioration of performance and parts of engines using the adulterated fuels. Some of the effects of adulteration are outlined below:
1. Mal-functioning of the engine, failure of components, and safety problems. The problem gets further magnified for high performance modern engines.
2. Increased tailpipe emissions of hydrocarbons (HC), carbon monoxide (CO), oxides of nitrogen (NOx), particulate matter (PM) and can also cause increased emissions of air toxin substances.
3. Adulteration of fuel can cause health problems directly in the form of increased tailpipe emissions of harmful and sometimes carcinogenic pollutants.
Possible solution
One significant step that would curb the activities of fakers and importers of substandard products is to take the campaigns seriously. One is looking up to the day as promised by the DG when the markets would be rid of substandard products.
Second is the issue of legislation which apparently is a cog in the wheel for SON. According to the DG, ?right now we have sent our bill to the National Assembly and hopefully within the next two to three months, if we get it out, I want to celebrate the first person I will send to jail, I will celebrate that person because the business of selling sub-standard products is not one that anybody should be proud about and I believe that it is thriving on the one part because the government has been a bit lukewarm on the enforcement but more importantly because we do not send people to jail. If you send one or two people to jail, I can tell you that a lot of people will stay out of that sort of business and that is exactly what I hope we would be able to do before this year runs out?.
Again, the regulatory agencies like NADAC and SON must be adequately funded to enable them execute their plans for the year. Finally, staff of these organisations must be properly empowered through rigorous training programmes for improved capacity to enable them build capacity for effective monitoring and testing of products.
Source: http://manufacturingtoday.com.ng/2013/06/22/the-dangers-of-substandard-ict-and-electronic-products/
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Public release date: 27-Jun-2013
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