The sale of counterfeit or pirated cell phones is expected to increase 19% in 2011 in the Brazilian market and reach 11.4 million units.
This includes phones imported illegally and sold without the approval of Anatel (National Telecommunications Agency), whose registration is required for sale.
In general, they are copies of desired models like Apple’s iPhone, in addition to models from Nokia, Samsung and Motorola.
This year, Brazilians will spend on average R$350 for a pirated unit and move R$4 billion in the counterfeit market.
The legal market, according to Abinee (Brazilian Association of the Electrical and Electronic Industry), should reach 57 million cell phones, up from 48 million last year.
“Brazil has one of the highest cell phone piracy rates in Latin America, around 20%, while the average for other countries is around 15%,” says Aderbal Pereira, of the Mobile Manufacturer Forum (MMF), which brings together manufacturers.
According to Pereira, the major motivation for buying is the price, which is one third of the list price.
“What the buyer still does not realize is that while buying certain functions, many others are not delivered, such as camera quality or internet access,” he says.
DAMAGE TO THE CONSUMER
A study to be presented by Folha which analyzes 44 models of the most copied cell phones in Brazil shows that in 26% of cases, the counterfeits fail to complete calls.
The survey, done by the Nokia Institute of Technology (INDT), the research arm of Nokia, also claims that 24% of counterfeit units show dropped calls, compared to the rate of 3% for legal cell phones.
The test also showed that the majority of the counterfeit phones tested fail to access the internet.
For the industry, an alternative for curbing piracy would be the reduction of import duties, which today are more than 30%.
“Peru, Columbia, even the United States, reduced duties on imports to zero. It could be an alternative for reducing piracy,” says Jose Martinez, of eComm Lac, an association of technology companies in Latin America and the Caribbean.
Besides the high tax burden, some bottlenecks in the industry favor the pirates.
International releases generally take months to get to Brazil and promise functions that the original versions don’t have, like more than one chip and a TV signal.
Today China is the main global force behind the dissemination of counterfeit phones. Last year, the country distributed 200 million fake phones, batteries and accessories.