Counterfeit chips: A $169 billion tech supply chain headache

Summary:The product fallout from counterfeit semiconductors can range from little things like dropped calls to much bigger issues such as plane crashes.

Counterfeit semiconductors have proliferated through corporations and the military and are a $169 billion risk to the electronics supply chain, according to research firm IHS.

According to IHS, these fake chips have proliferated and are used for industrial purposes and found in cars, consumer electronics, wireless and networking gear and computers. Analog chips, microprocessors, memory and transistors are commonly counterfeited.

Here's a look at the most common counterfeit semiconductor types and percentage share of the market in terms of revenue.

What's the risk? For starters there are quality control issues. These counterfeit chips are created from materials that could be salvaged waste. The product fallout can range from little things like dropped calls to much bigger issues such as plane crashes, medical issues and billions of dollars in returned goods.

Topics: Enterprise Software, Hardware, Networking, Processors


Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CN... Full Bio

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