The Real Costs Of Counterfeit Electrical Products In The Data Center
Unsafe counterfeit products can cause harm to people and property.
Data center managers demand the highest degree of availability for their equipment.
Customers expect uninterrupted access to services and instant interaction. Avoiding service interruptions and downtime is critical. As terabytes of information flow daily, application availability and resilience are mission critical, requiring data center managers to do everything possible to minimize downtime.
Power outages due to weather and unforeseen events remain a leading cause of downtime. According to Eaton’s Blackout Tracker Annual Report, more than 3,714 people were affected for over 49 minutes per outage in 2015 creating difficulties for individuals and businesses in all 50 states.
Downtime risks posed by the installation and use of counterfeit electrical products is one event that is possible to avoid. As counterfeiters become increasingly more sophisticated, it becomes ever more important to be aware of the potential dangers of counterfeits and how to avoid them.
COST OF DOWNTIME RISKS
Low cost, bargain electrical products sourced outside of authorized resellers may seem appealing at first, but upon further inspection the old adage stands true — if it seems too good to be true, it probably is.
Counterfeit electrical products often use inferior materials without regard for any labeled ratings or customer safety. In fact, they typically lack independent certification and testing that is relied upon to ensure products operate as intended. Counterfeit electrical products can result in product malfunctions or failures, leading to downtime.
Since no well-known brand is completely safe from counterfeiting, counterfeit products can include electronic components and electrical safety equipment, such as circuit breakers designed to provide circuit protection for power distribution systems and to safeguard people and equipment. All data center technologies, the backbone to a business, depend on reliable electric power to operate as designed.
A breaker failure means the loss of power, possible equipment damage necessitating costly system analysis and replacement, and the increased risk of employee injury at the time of failure or during maintenance. A product failure can bring down even the most modern and sophisticated data center.
Lost or corrupted files. Hardware malfunctions. The inability to access the critical systems you need. All of these unpleasant consequences — just a small sampling of the possible outcomes of unexpected downtime — can significantly impact the ability to conduct business. Not to mention the potential for lost revenue and damaged reputation in the event that customer service mechanisms, such as online ordering, phone systems, or other sales tools are unavailable to potential customers.
In many instances, there is very little lag time between system downtime and financial disaster.
COST OF LEGAL AND PERCEPTION RISKS
Counterfeit electrical products also present serious legal and perception implications that can create problematic issues for individuals involved in the procuring, design, and installation of the product and its environment.
In the event that a counterfeit electrical product causes harm to an individual or property, investigation and litigation can take much longer to complete than the 24-hour news cycle allows. This can potentially damage brand reputation and bottom lines of companies associated with the project.
COST OF SAFETY AND PROPERTY DAMAGE RISKS
Failures of counterfeit electrical products are also capable of significant property damage and safety concerns. Using these carbon copies can result in malfunctions causing overheating or short circuits that may lead to fires, shocks, or explosions that can ultimately cost workers their lives and produce considerable property damage.
According to the National Fire Protection Association (NFPA), electrical failure or malfunction contributed to 21% of associated direct property damage in reported U.S. non-home fires from 2007 to 2011.
Suspect and counterfeit electrical products present unnecessary risks to the data center.
A GROWING ISSUE
The counterfeiting of well-known brands and products is a growing problem, estimated to be 5% to 7% of world trade. Of those well-known brands and products are consumer safety and critical technology products, estimated to be 27% of counterfeit items seized by U.S. Customs and Border Protection in 2014.
The sophistication of modern counterfeiting techniques can make it difficult to tell the difference between a counterfeit and an authentic product until after it fails while in use. By definition, a counterfeit is a product, service, or package for a product that uses, without authorization, the trademark, service mark, or copyright of another intended to deceive prospective customers into believing that the product or service is genuine.
The sophistication of shipping counterfeit products is also adding to the difficulty of detection. A counterfeit shipment takes an indirect shipping route to the intended destination. In some instances, the counterfeit products and other infringing components ship separately, further increasing the difficulty of detection. In addition, counterfeiters have reduced the size of a shipment to decrease losses in the event of a shipment seizure.
AVOIDING UNSAFE LOOK-A-LIKES
Professionals across all industries, including data centers, should understand the implications of using suspect, fraudulent, or counterfeit electrical products in their work environments. To prevent these unsafe devices from causing harm to equipment, employees, or environments, you must take action. The below tips and best practices will help data center managers properly avoid, identify, and report suspected counterfeit electrical equipment.
Purchase directly from an authorized distributor. The best way to avoid counterfeit electrical products is to always buy authentic, directly from the manufacturer’s authorized distributors or resellers. There is a higher risk of counterfeits if you cannot trace the path of commerce to the original manufacturer.
Trusted manufacturers are expanding their supply programs to help authorized distributors source and supply authentic products quickly and efficiently to endusers. Eaton offers its “Power of Authenticity” program, offering competitive prices, stocking programs, authorized service centers, and loyalty programs so endusers can rest assured that the products they receive are authentic Eaton products.
By taking the time to safeguard only genuine products, procured directly from authorized resellers, are used, you can help prevent unplanned outages, reduce costs, and mitigate safety risks associated with counterfeit products.
Conduct thorough evaluation. It’s difficult to spot a counterfeit when you see one. Counterfeiters are becoming more and more sophisticated, using deception, the internet, and prices below market value to attract business. To confirm your component or product’s authenticity, thorough evaluation is critical.
Be leery of poor-quality labels with legacy branding, missing date codes, and extraneous markings or labeling not applied by the original manufacturers. Eaton uses branded packaging on nearly all component products for easier identification. Also, Eaton provides laser-marked labels for its molded case circuit breakers (MCCBs), which require more sophisticated technology to manufacture and are designed to be more tamper-resistant, helping to authenticate each circuit breaker throughout its life cycle.
Also, when buying electrical equipment, be cautious of “bargains.” Compare the price of products to similar products at a different retailer. If the price seems too good to be true, it likely is.
Lastly, use tools provided by the original manufacturer or certification organizations, like Eaton’s Circuit Breaker Authentication (CBA) tool, to verify your electrical device’s authenticity. Customers can access the tool on Eaton’s PowerEdge mobile app and, by scanning information from the product label with the click of a button, detect if Eaton’s molded-case circuit breakers, up to 400 amperes, are counterfeit.
Report suspect products. If you suspect a product to be counterfeit, report it to the brand owner immediately. This will allow authentication of the suspect device and ensure that the potentially unsafe product is removed from the marketplace. Contact Eaton at firstname.lastname@example.org.
The more information a manufacturer has, the better chance it can find similar counterfeit products and remove them from the marketplace to protect consumers. When reporting potentially dangerous products, work to disclose the product vendor’s name, business name, address, domain name, and any other identifiers. It’s also helpful to share a description of the commodity, including an explanation on why it is suspect to be counterfeit.
If you cannot find brand contact information, don’t stop there. Reach out to the IPR Center who will disseminate the information for appropriate response. Contact the IPR Center at IPRCenter@dhs.gov or 1-866-IPR-2060.
Genuine electrical products can help ensure all systems maintain operational efficiency. To help ensure that power loss never interrupts their customers’ businesses, professionals should always use authentic electrical equipment.
The risk of any system failure due to suspect counterfeit equipment is one no data center facility should take.
To help thwart counterfeiting, industry organizations, manufacturers, customers, and government bodies must continue to collaborate to share best practices and spread awareness. It is only through collaboration that we may be able to enact measures that will lead to more effective detection and reporting of counterfeit electrical products.
Many companies are leading initiatives to protect public health and safety by collaborating with industry partners to prevent these unsafe counterfeit products from causing harm to people and property. For example, Eaton has a zero-tolerance policy for counterfeiting and is committed to anti-counterfeiting technologies and programs. Slowing the proliferation of counterfeit electrical products can help to ensure maximum electrical safety levels for consumers.
Industry organizations, such as National Electrical Manufacturer’s Association (NEMA), allow member companies in the electrical industry to focus their collective efforts on identifying ways to stop counterfeiting. Industry representation by NEMA can be used to promote laws, regulations, or government directives. Other industry organizations, such as Electrical Safety Foundation International (ESFi), rely on engagement from the electrical industry and supporters to promote consumer awareness of counterfeit electrical products. These collaborative efforts carry a stronger message and improve awareness and detection dramatically.
The government also plays a vital role in the fight against counterfeiting. In the United States, the U.S. Customs and Border Protection is in charge of keeping foreign, pirated, and counterfeit goods from importation into the country. In order for governments to be effective at blocking the proliferation of counterfeit products at customs and borders, laws need to be enforceable while supporting the victims and not the criminals. The engagement of government to create stronger deterrent penalties, especially where safety issues are concerned, is crucial to stopping counterfeiting.
In addition, the government needs industry support and collaboration to be effective. A high degree of brand holder engagement with law enforcement is essential to successfully enforce intellectual property rights (IPR) laws and take criminal action against illicit manufacturing, importers, and brokers of counterfeit electrical products.
From the manufacturer that designs the product, to the government body inspecting imports and the contractors that install them, if every individual along a product’s supply chain played an active role in stopping counterfeit products from being bought and sold, the demand for counterfeit electrical products would decrease.
It is crucial to continue to work together to prevent these unsafe counterfeit products from causing harm to people and property.