IDEANewsletter May2013 LH

7/27/2019 IDEANewsletter May2013 LH

1/31

ADEC - South AfricaAssociatio n of DistributorsofElectronic Components

ASPEC - RussiaAssociatio n ofSuppliers of

Electronic Components

ASSODEL - ItalyAssociazione Nazionale Fornitor i Elettronica

CEDA - ChinaChina Electronics DistributorAlliance

ECAANZ - AustraliaElectronic Components Association

Australia an d New Zealand

ECIA - United StatesElectronic Components IndustryAssociation

ECSN - United KingdomElectronic Components Supply Network

ELCINA - IndiaElectronic Industries Association of India

FBDI - GermanyFachverband der Bauelemente Distribution

FEDELEC - TunisiaTunisian Federation ofElectricand Electronic Industries

JEPIA - JapanJapan Electronic Products ImportersAssociation

SE - SwedenThe Swedish Electronics TradeAssociations

SPDEI - FranceSyndicat Professionnel de la Distributionen Electronique Industrielle

MAY

2013

n 2 - 2013

NEWSINTERNATIONAL DISTRIBUTION OF ELECTRONICS ASSOCIATION

FEDERATION IDEA

May 2013

4 -A great start to 2013!

6 - PCIM 2013:Power applications will growfaster and faster

7 - Russian Electronic

IDEA / FBDi Trend Days

2013: Megatrends forTomorrows ElectronicsMarket

Components market trends

8 - Will increased pricetransparency really help?

10 - Electronics:the essential element!

10 - The French ElectronicIndustry in action

11 - ECIA web-site nowincludes B.O.M facility

12 - Changing businessenvironment favours Indianelectronics manufacturing

13 - 2013 CEDA ExecutiveConference to be held in Xian

14 - The Fortronic story getsbetter and better

15 -Authorized Distributionversus Counterfeit Parts

ASSOCIATIONS

by Georg Steinberger

Chairman FBDi e.

V. Chairman DMASS Ltd.

ww w .fbdi.de

SOCIETY, TECHNOLOGY, AND

ECONOMY - OPPORTUNITYOR THREAT?Participants of the IDEA/ FBDi

Trend Days 2013 (28 + 29

November, Munich) can look forward

to groundbreaking topics presented by

compelling, prominent speakers.

The aim of the Trend Days is to

provide food for thought and a valuable

insight by highlighting the relevant

trends

and megatrends for theelectronic components market.

As a kick-off on the first day Dr. David

Bosshart will hold the keynote

speech. The head of the Gottlieb

DuttweilerInstitute in Zurich is a

renowned

Participantsof the

IDEA/FBDi Trend Days 2013 (28 +

29 November,

Munich) can lookforward to groundbreaking topics

presented by compelling,

prominent speakers
http://www.fbdi.de/http://www.fbdi.de/


2/31

Anadditional

highlightis the

paneldiscussion

focusing on Tomorrowsneeds

ofDistribution

futurologist, when it comes to

trends, mega trends and

counter trends of tomorrow.

He will reveal radical social

and economic changes

expected to strongly shape

the consumerbehaviorof the

future.

A range of electroniccomponents industry leaders

and thought leadership

academics will share their

visions and predictions

for the future. In addition,

industry analysts, e-commerce

professionals, and technology

promoters report on how the

electronic components

markets will evolve in Europe.

An additional highlight is thepanel discussion focusing on

Tomorrows needs of

Distribution.

The agenda consists of

highly proactive topics

which will decide the future

of

ourindustry and affect

our strategies

significantly.

IDEA Chairmanscomment

Ilook forwardto meeting you in

Munich to gain an insight from

acknowledged industrythought

leaders, whilst meeting sociallya

wide range ofourpeers

at a genuinely

world class event...

Ma

y Ienc

our

ag

e

you

to

bo

ok

yo

ur place

today...

Adam Fletcher

www.ideaelectronics.co

m 1
http://www.ideaelectronics.com/http://www.ideaelectronics.com/http://www.ideaelectronics.com/http://www.ideaelectronics.com/


3/31

New

2 ww w .ideaelectronics.com

Location:

The Rilano Hotel Mnchen****,

Munich (Schwabing), Germany

Date:

8 November 2013, 2 pm 7 pm

29 November 2013, 9 am 3 pm

Target audience:

CEOs, managing directors, department

heads, design and business

development managers, and short-

andlong-term decisions makers

Speakers:

Dr. David Bosshart,

Gottlieb Duttweiler Institute (GDI)

for Economy and Society

Karin Vey, IBM Research

Prof. Dr. Norbert Bolz,

Technische Universitt Berlin

Klaus Wohlrabe, Ifo Institute

forEconomic Research

Dr. Bettina Enderle,

Allen & OveryLLP

Jonathan Mller,

foryouandyourcustomers

Siemens AG

Fraunhofer Institute IPA

Project Sustain Hub and others.

Languages: (simultaneous translation)

German / English

Price:

790 Euro (plus 19% VAT) / 10%

discount for IDEA / FBDi membersincludes lunch, coffee breaks, and an

evening event on November 28.

Registration:

Please fax to +49 8122-55917-29

or mail [email protected]

Attention:

Limited number of participants!

Accommodation:

Overnight accommodation is not

included in the price. The FBDi has

reserved rooms at the Rilano Hotel

Mnchen, which you can book by

using reference FBDi2013.

The rooms are available until October

3. Price includes breakfast.

The Rilano Hotel MnchenDomagkstrasse 26 - 80807 MunichTel.: +49 (0) 89 360010ww w.rilano-hotel-muenchen.de/en/

[email protected]

Comfort single:132 / superior single 152.Rooms may be cancelled at no chargeup to 18/11/2.

Theagenda consists of

highlyproactive topics

which will decide the futureof

our industry

This event is an excellent

opportunity to get to know

about cross-industry trends

in a concentrated form.

The top-class event with the

motto Society, Technology

andEconomy- an

Interconnected Futurewill

take place at the Rilano

Hotel in Munich.

In cooperation with the

International Distribution

ofElectronicsAssociation

IDEA the FBDi invites

representatives from the

electronics industry, the

electronic components market,

suppliers, manufacturers, and

decision makers of medium-and long-term developments

in the European market.

Information on the registration

and furtherfacts about the

programme are as follows:

Additional information is

available from

ww w .fbdi.de/en/t rend-days

Just to remind readers.If you would like to have theoriginal graphics used in thisarticle just email to the IDEAsecretary at [email protected]

The IDEA statistics are takenfrom actual bookings andbillings returns made by asubstantial percentage ofthe electronic componentdistributors in Europe,including all the major

distribution groups.

Their sales represent Circa70% of the total Europeandistribution market so thetrends shown are trulyrepresentative.
http://www.ideaelectronics.com/mailto:[email protected]:[email protected]://www.rilano-hotel-muenchen.de/en/http://www.rilano-hotel-muenchen.de/en/http://www.rilano-hotel-muenchen.de/en/mailto:[email protected]://www.fbdi.de/en/trend-dayshttp://www.fbdi.de/en/trend-dayshttp://www.fbdi.de/en/trend-daysmailto:[email protected]://www.rilano-hotel-muenchen.de/en/mailto:[email protected]://www.fbdi.de/en/trend-dayshttp://www.ideaelectronics.com/


4/31

News

ww w .ideaelectronics.com

IDEA /FBDi Trend Days2013

Society, Technology, andEconomy - Opportunity orThreat?

28th-29th November 2013

The Rilano Hotel,

Munich, Germany

WHAT YOU CAN EXPECT:

A unique overlook on trends and

megatrends in society, technology

and economy in Europe

Interdisciplinary know-how:new technologies in sensors, medicine,

robotics etc.

Compact and practical presentation

of trend topics by renowned speakers

Knowledge sharing and networking

with specialist from the electronic

industry

OURSPEAKERS:

Dr. DavidBosshart - CEO of Gottlieb Duttweiler Institute (GDI)

for Economy and Society

Prof. Dr. NorbertBolz - Professor of Media Studies

at the University of Technology Berlin

Siemens AG, IHS Electronics & Media, IBM Research, ifo Institute, Fraunhofer Institute IPA,

Allen & Overy LLP, foryouandyourcustomers AG and Project Sustain Hub.

Inpartnership with
http://www.ideaelectronics.com/http://www.ideaelectronics.com/


5/31

3

Book now on www.fbdi.de/en/trend-days
http://www.fbdi.de/en/trend-dayshttp://www.fbdi.de/en/trend-dayshttp://www.fbdi.de/en/trend-dayshttp://www.fbdi.de/en/trend-dayshttp://www.fbdi.de/en/trend-days


6/31

New

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I

Percen

tchange

k

16.9

%

1.1

5

-4.9

%

1.1

1

6.7

%

1.0

8

-4.3

%

0.9

9

0.9

5

10.8

%

-2.9

%

0.8

9 0.9

4

18.9

%

0.9

4

-5.7

%

0.9

6

20.6

%

0.9

5

-12.8

%

1.0

7

1.0

1

19.8

%

-3.9

%

Agreat start to2013!

Nordic region and the

weakest by France.

by Gary Kibblewhite

ww w .ideaelectronics.com

n the last IDEA Newsletter

the results forQ4

indication that the market

has at last bottomedand

the results for Q1 confirm

this.

It was indeed a much

betterquarterwith total

European bookings and

billings at the highest since

Q3 2011.

The only concern is that the

Book:bill ratio dropped to

1.01:1 and, whilst this is

still positive, it is

disappointing

maintained. It is interesting to

see that the strongest book:bill

in the quarterwas that of Italy.

GraphicT1 shows the actual

sales and orders across

Europe together with the

book:bill ratio.

Looking at the total

billings trend GraphicT3

shows

that all regions have shown a

healthy growth overthe prior

quarters sales but it also

ECONOMIC BACKGROUND

The latest European

production statistics show

that Industrial production

in March rose by 1% when

compared with February, this

was also a marked

improvement overthe prior

quarter.

Again, we must not forget that

March production was still 4.6%

worse than that in March 2012.

In addition the Euro area GDP

in the first quarterof 2013 also

fell by 1% when compared to

the

giving

2012 I said There isevery

to see that the levels of the

last quarter have not been

reminds us that we arestill

same quarterlast year. Mixed

Q1 2013 TOTAL COMPONENTS booking, billing&book: bill ratio Graphic T1

Total distribution el ectronic components booking, billing and Book:bill ratio for Germany,

France, Italy, UK, Sweden, Norway, Denmark & Finland

running at marginally below the

level of last year.

The strongest growth % in

messages again!

The comparison on this chart

2000 1.40 billings was experienced by the with the USA is interesting!

1500

1.20

Bi llingTOTAL INDUSTRY (EXCLUDING CONSTRUCTION) - EURO AREA & EU27 PRODUCTION Graphic 1

1000

1.00Booking

0.80B2B

500

0.60

0

Q2 -10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-1 2 Q1-130.40

ww w.ideaelectronics.com

Q1 2013 TOTAL COMPONENTS billing trend Graphic T3

Distribution sales of Electronic Components by Country comparing current qtr with priorquarter(Q/Q1) and same quarter prior year ( Q/Q-4)

25%

20%

Source: Eurostat

15%

10% GDP GROWTH RATES - EURO AREA & USA Graphic 2

5%

Q/Q- 1

0% Q/Q- 4

-5%

-10%

-15%

Avg France UK Italy Nordic Germany
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New

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Source: Eurostat
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8/31

Y

400

& Finland

1.40

3501.30

3001.20

1.10

2501.00

k

Percentchange

1.1

7

10.3

%

1.1

2

1.9

%

1.0

8

2

1.9

%

0.9

6

3.5

%

0.9

3

7.6

%

0.8

7

-2.9

%

8.3

%

0.9

1

6.3

%

0.9

4

15.0

%

0.9

3

-3.1

%

1.0

8

9.5

%

1.0

2

3.0

%

k

k

1.

09

1.1

3

1.

07

1.0

9

1.

09

1.0

6

1.

06

1.0

2

1.

02

0.9

7

0.

93

0.8

9

1.

03

0.9

2

1.

01

0.9

8

0.

99

0.9

8

1.

00

0.9

7

1.

06

1.0

3

1.

01

0.9

6

Q1 2013 TOTAL COMPONENTS BOOKING TREND Graphic T2 Q1 2013 PASSIVE COMPONENTS booking, billing & book:bill ratio GraphicP1

Distribution orders for Electronic components by country compari ng Q4 2011 with prior

quarter (Q/Q1)and same quarter prior y ar (Q/QY-1)Passive components Bookings, billings & book:bill ratio for Germany, France, Italy, UK,

Sweden, Norway, Denmark & Finland

25%250 1.40

1.30

20%

15%

10%

5%

0%

Q/Q-1

Q/QY-1

200

150

100

50

0Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13

1.20

1.10

1.00

0.90

0.80

0.70

0.60

0.50

0.40

Billing

Booking

B2B

-5%

Avg France UK Italy Nordic Germany



Q1 2013 EMECH COMPONENTS booking, billing & book:bill ratio GraphicE1

ELECTRONIC COMPONENT

SALES IN Q1 2013: OVERVIEWTotal components

GraphicT2shows that the

reversal from decline to growth

started last quarterhas

continued with all regions

showing a strong bookings

growth overthe priorquarterand

all regions apart from

Nordic and the UK showing a

been good improvements in the

quarterwith a strong growth in

both bookings and billings. This

has only been marred by the

drop in Book:bill from 1.08:1 to

1.02:1.

Howeverit is still positive!

Passive Components

Similarly, passive components

200

150

100

50

0

Emech bookings, billings & Book:bill ratio for Germany, France, Italy, UK, Sweden, Norway,Denmark

0.90

0.80

0.70

0.60

0.50

0.40

Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13

Billing

Bookin

g B2B

growth overthe same quarterlast

year.

QUARTERLY SALES BY

PRODUCT FAMILY

Each quarterwe look at both

booking and billing trends by

both product and by market.

Firstly product. Breaking the

product total into the main

elements, initially the largest:

across Europe have shown a

strong recovery in both

bookings and billings in the

first quarterwith,

unfortunately,

the book:bill ratio

dropping below 1:1.

Electromechanical

components

GraphicE1 shows the

behaviourofElectromechanical


billings but a slightly worsening

book:bill.

QUARTERLY SALES AND ORDERS

BY GEOGRAPHIC REGIONThe tendential index by product

shows that, when compared

with the same quarterlast year,

although we are still below last

years performance, the gap is

narrowing so that, given at least

a flat book:bill for the

next couple ofquarters, we

should see all product

categories growing overthe 0%

line for the rest of the year.

Semiconductors.

GraphicS1 shows that there have

components: from the data

they seem to have a strong

growth in both bookings

and

Q1 2013 TOTAL COMPONENTS tendential index by product Graphic 3

Q1 2013 SEMICONDUCTOR booking, billing & book:bill ratio Graphic S1

Passive components Bookings, billings & book:bill ratio for Germany, France, Italy, UK,Sweden, Norway, Denmark & Finland

1400 1.40

1200

1000

1.30

1.20

1.10

Billing

800

600

1.00

0.90

0.80

Booking

B2Bww w.ideaelectronics.com

400 0.70
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0.9

1

200

0.60

0.50

0

Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-130.40

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10/31

14.000 20%

12.000 15%

10.000 10%

8.000 5%

6.000 0%

4.000 -5%

2.000 -10%

-2011 2012 2013 2014 2015 2016 2017 2018

-15%

Rectifiers 1. 527 1.450 1. 552 1.815 1.997 2.097 2. 201 2.312

X-FET Power 1. 532 1.340 1. 514 1.862 2.021 1.859 1. 974 2.097

Thyristor 787 740 802 922 1. 028 1. 029 1. 107 1. 191

GTO, IGCT, GCT 52 45 49 59 66 66 71 77

Bipolar 932 880 954 1. 059 1. 149 1. 103 1. 193 1. 286

IGBT 4. 182 3.264 3. 625 4.347 4.898 5.130 5. 570 6.053

available and the first tests inThats what Chart1, the result

of a research prepared by the

the world of traction are running.

Probably the SiC power that

and presented in a seminar held

during PCIM 2013, shows.

middle devices for 1,200 and

1,700 volts are ready but the R&D

T

T

Yea

r-

on-Y

ea

r

(%)

MarketSize(M

$)

Productrange

PCIM 2013: Power applications

will grow faster and faster

disappear, replaced by

SuperJunction MOSFETs

that will compete with SiC

and GaN. Infineon and

STMicroelectronics are the

undisputed market leader. In

2010 they had more than 85%

of the SJ MOSFET market (Yoleby Franco Musiari

Technical Director, Assodelww w.assodel.it

2011-2018 - MARKET SIZE FOR DISCRETE POWER DEVICESDeveloppement), but in the

meantime many new suitors have

arrived (at least 15) to fight for

some market share that has an

estimated double digit growth.

he market is growing -

better than the average

forsemiconductors -

and

the scenery is on the move and

will be moving as fast as ever in

electronics. In the frantic search

for alternative energy, in other

words wind and solarpower,

for energy saving and efficiency

improvement to the last percent,

all in the name of 20-20-20, not

to mention the rich markets of

electric or hybrid car, the field of

power semiconductors is enjoying

happy times in both innovation

and the search foralternative

solutions.

PowerFortronic

will take place

on 19th October,

Source: Yole Developpement

MARKET SIZE AND TREND

In 2011 the market fordiscrete

power devices was $9.0B andin 2012 it has suffered the

most from the economic crisis

losing

$1.3B i.e. 14.3%. Trusting in

the graphs data, this year

and next year the market will

see

an outstanding recovery: first a

+10% and then e +18.5% that

will bring the market to $10B at

the end of2014.

THE TECHNOLOGICAL SCENARIO

SiC and GaN are now amongst

us but there is still a big question:

where and when? The first SiC

needs to achieve higher voltages

to extend theirreach.

The GaN will target the average

power range and probably

will enable the realization of

remarkable switched power

supplies: compact and very

efficient! The devices for 600V

are ready, and in the qualification

phase, but not yet up to 1.200V,

which will allow SiC to develop

and expand.

But Silicon will not give up.

The planar technology,which is more mature, will

slowly

The major surprise comes fromthe Trench Field Stop IGBT

technology that is adding a

new dimension to the category.

As shown in Chart2, IGBTs

are going to gain share in high

voltage (3.3kV) low end solutions

against thyristors and IGCTs

(Integrated Gate-Commutated

Thyristor) and low voltage high

end solutions against MOSFETs

thanks to the optimisation of

production costs and improved

switching performances.

The market for IGBT, which

exceeded $3.2B in 2012 and

promises to grow at an average

annual value of almost 11%

between 2010 and 2018 will

see, alongside the most historic

players - Infineon, Mitsubishi,

Fuji Electric, Hitachi and

Toshiba - in addition manynewcomers.

SiC

IGBT ThyristorIGCT

400V 600Vorless

1200Vor more

3.3kVand more
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11/31

Source: Yole Developpement


12/31

4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13

Relative Volumecompared to4Q2010

100% 98% 108% 106% 101% 102% 107% 117% 119% 99,64%

Increase comparedto the same periodof the previous year

- - - - 1,0% 4,1% -0,9% 10,4% 17,8% -2,3%

Increase comparedto thepreviousuarter

- -2,0% 10,2% -1,9% -4,7% 1 ,0% 4 ,9% 9 ,3% 1 ,7% -16,3%

A

Russian Electronic Components market trendsby Ivan PokrovskyExecutive Director

Russian market ofelectronic

components was about 123%.

Correlation oil prices and the russian elec. components market volume Chart 2

2623

ASPEC

Decreased production of electronic

equipment and, accordingly,

the consumption ofelectronic

components began in the late

2008. Since the fourth quarterof

2008 the volume of electronic

equipment production decreased

by 40% compared to the same

Oil price,USD/barrel

624

816

1176

988

1431

1861

2163

1898

1406

2344

2522

ccording to the study

commissioned by

Association, the

period of the previous yearand

was at this low level during the first

and second quarter of 2009. In the

Blue graph - Volume of the Russian Electronic components

market, $ (mil) Red graph - Oil price, USD/barrel

ASPEC

volume of the RussianElectronic

Components Market exceeded

$ 2.5 billion in 2012.

Russian Electronic Components

Market graph presented in Chart1

illustrates market volume changes

in the past 10 years. The marketvolume was calculated in final

consumer prices including VAT.

The study took into account sales

third quarter of 2009 equipment

production and consumption

of EC recovered. Rapid growth

continued in 2010. In the Q4 2010

the market volume exceeded the

pre-crisis level while the dynamic

market growth stopped.

Moderateoptimisticscenarios for the

Russian economy project

Dynamics of quarterly electronic components sales Fig. 3

of semiconductors, passive,

electromechanical components,

electronic modules and displays,

which are used in electronic

equipment production. Sales of

large monitor, TV displays and

computer components forSKD

computer equipment were not

taken into account.

In the six years up to 2008

the average annual growth of

the

the Russian Electronic

Components Marketto

grow by a fewpercent in 2013

In 2011 and 2012 the growth rate

was decreasing. Moderateoptimistic scenarios for the Russian

economy project the Russian

Electronic Components Market to

grow by a few % in 2013.

Russian electronic equipment

production is mainly focused on

domestic demand, that is critically

dependent on income generated

from the . Thus, the market for

electronic components is also

influenced by this factor.

Export-oriented

strategy of the

electronic industryis able to provide a

Based on the volume ofpre-

orders, suppliers predict sales

increase in the second halfof

the year, which should ensure

market growth for the yearby

a few percent. More detailed

study results are presented in the

report, see http://ww w.sovel.org/research_eng.php

Long-term Russian Electronic

Components Market prospects

Russian electronic components market volume & growth in 2002-2013 Chart 1

Market Volume, $ (mil) Annual Growth, %

higher growth rate

Chart2shows the correlation

between oil prices and the

volume of the Russian electronic

components market.

depend on the strategy ofthe

Russian radioelectronics industry

development.

Inertial strategy focused on

domestic demand makes the

development of the industry and

the electronic components market
http://www.sovel.org/http://www.sovel.org/http://www.sovel.org/http://www.sovel.org/


13/31

B

Will increased

price transparencyreally help?

dependant on oil and gas and

raw materials exports. Export-

oriented strategy of the electronic

industry

is able to provide a highergrowth

rate and reduce the industrys

dependence on the oil and

commodity markets conditions.

Such a strategy requires

substantial simplification of

customs procedures, which

are currently a major barrierto

exporting high-tech products.

However, shale gas development

and likely energy demand

reduction in Europe create a real

threat to oil and gas revenues.

This drives the government

to review its approaches to

the Russain industrial policy

management.

Future development of economic

and industrial strategy involves

public benefit organizations,

including trade associations.

According to Oscar Wilde a cynic knows the price ofeverything but the value of nothing and Adam Fletcher-

Chairman of ecsn, suggests some cynicism is rifein the field of electronic components supply.

In this article he argues that unit price transparencyisntwhat really matters in electronic componentprocurement

and that total acquisition cost, which involves factorsbeyond mere unit price, is the more critical metricbutis

often more difficult to measure.

In addition, the export-oriented

strategy should provide

institutional support for a large

number of innovative smalland medium-sized exporters.

Long-termRussian

Electronic Components

Market prospects depend

on the

strategy of the Russian

radioelectronics industry

development

It is next to impossible to

accomplish this with the existing

policies aimed at consolidating

assets in large but slow-

moving government holdings.

Administrative management

style suppressed entrepreneurial

energy and restrained innovative

development. Government could

ignore the problem, while high oil

prices covered for the costs ofmismanagement.

In order to participate in these

activities, electronics industry

associations have decided to set

up an Association Council.The Electronics Industry

Associations Council shall approve

initiatives and proposals of

different business communities

and develop a common set

of measures to stimulate

the industrys

development.

At present, the Councilconsists of:

The Association ofTelecommunications EquipmentManufacturers,

The Association of ConsumerElectronics Manufacturers and

Suppliers,

The Association ofBroadcast

Equipment Manufacturers,

The Association of PowerSupply

Systems Manufacturers,

The Association of LED Components

and Systems Manufacturers,

The Association ofSoftwareDevelopers and our Association of

Electronic Components Suppliers.

byAdam Fletcher

Chairman of IDEA and ECSN

ww w .ecsn-uk.org

efore the arrival ofthe

internet most

organisations managed

to successfully launch their

new products despite limited

intelligence and availability

of component pricing in the

market. Their primary source

of market intelligence and price

information was obtained from

purchasing, estimating and

engineering personnel who

interfaced with a wide variety

of sales and marketing people

from competing suppliers in themarket.

The electronic components

markets have always been

cyclical but pre-internet
http://www.ecsn-uk.org/http://www.ecsn-uk.org/


14/31

were more regionally focused,

with some market price

ifferentiation. By carefully

etermining the current point in the

ycle (i.e. a Buyeror

ellers market) it was possible to

etermine whether to take a long or

hort-term procurement decision.

Most organisations had a primary,

econdary

nd tertiary preferred supplier

tructure.

hey strategically focused theirnew

roduct development

n products from suppliers

n the primarylist that were on the

market or very close to release. They

leaned additional intelligence from

atalogues and price lists,ompetitors, from

nter-company data, by informal data

haring with colleagues and from

market information printed

n the trade press.

ODAY...

here is a vast amount ofdata and

ricing information available on the

nternet provided both

y the electronic components

manufacturers and theirauthorised

istributors.


15/31

Generic search engines like

Googleprovide quick access to

some information but the use of

dedicated industry specific search

engines yields better results.

Parametric search facilities - which

focus on the specific features

(colour, voltage, size) of a product

- are a particularly valuable tool for

improving search efficiency and

selection.

Electroniccomponents

manufacturers and their

authorised distributors haveput a lot of effortinto the

provision

of comprehensive onlineinformation

Electronic components

manufacturers and their

authorised distributors have put

a lot of effort into the provision of

comprehensive online information

including life cycle information

on their products togetherwith

and an insight into which of their

components they recommend for

new designs.

Legitimate industry specific search

engines aggregate information

directly from a known range ofthe

manufacturers and their authorised

distributors, who guarantee the

quality of the information provided

to users on a real-time basis.There are also illegitimate search

engines that merely scrape data

from likely sites and present it to

users as valid data.

Mostelectronic

components are today

priced globallywith the

primary currency

being US

Unfortunately for some, there

are also search engines that

propagate fraudulent data

and deliberately set out to

deceive users.

Most electronic components are

today priced globally with the

primary currency being US$. Many

websites provide exchange rateconversion of pricing information

into a regional or local currency

appropriate to where the user

is based, adding local taxes etc

automatically where applicable.

The downside is that most on-

line pricing information available

today is primarily linked to a

very specific manufacturers part

number, and usually doesnt

provide much more than 1,100

and 1000pcs price guidance. The

increased use ofsocial networks

is enabling the wider sharing of

some price information but most

of the discussions are focused on

technical and othercommercial

information.

What is not currently available

from either source however is an

insight into which combination

of physical device packages,temperature ranges, voltages etc

and manufacturing / transport

packaging variables is or will

achieve the lowest costs and

therefore define what is or likely to

become the industry-standard high

volume device.

So whist the internet provides

access to vast amount ofdata,

human intelligence still needs to

be applied to convert the results

into really useful technical and

commercial information.

THE FUTURE...

Customer pricing in the electronic

components supply network

will continue to remain a highly

competitive and very complex

issue with a great many variables.

The competitive nature ofthemarket and need forboth

increased volumes and constant

cost reduction will continue to

drive innovation and price decline.

Thecompetitive nature of

the market and need for both

increased volumes and cost

reduction will continue

to drive innovationand price decline

A few organisations believe they will be

able to develop websites able

to support individual component orfull

Bill of Material costing and price

optimisation for existing and new

product introduction based on the

customers purchasing position.

I think that this is highly unlikely to be

successful because there are hundreds

of thousands of available parts and just

too many unknown variables involvedin the calculation to yield a successful

outcome.

To further increase absolute price

transparency would require

purchasing organisations to disclose

competitive price information to a

third party for

the benefit of a perceived wider

good.


16/31

How effective this would be or

ifit is a legitimate (or indeed

legal) activity to pursue

remains to be seen. It seems

likely however that future

generations ofwebsites

will provide automated trading

platforms that are able to

compare pricing (and

importantly availability) for a

given customeragainst

agreed volume pricing from anumber of preferred suppliers

and recommend actions

and/orplace orders

appropriately.

The electronic components

Bill of Material cost for

European- based Systems

Integrators

is stable or declining. These

companies have to be exploring

other commodity areas where

increased

procurement/engineering

investment holds the promise

of better cost reduction

results. Perhaps the

electronic supply network

needs an optimised

Trip Advisorand Go

Comparecombination that

will enable a widerview on the

overall value added propositionprovided by suppliers rather

than just their unit price!


17/31

E

O

Electronics:

The essential element!

The French Electronic

Industry in action

by Lena Norder

SE Swedish Electronics

TradeAssociation

lectronics is an essential

element for virtually all

industries. Telecom,

automotive, bio- and medical

technology as well as mining and

processing industries arejust

a few industries that cannot do

without advanced electronics.

Electronics is also importantenabler needed in orderto

solve the future challenges of

increasing energy consumption

needs ofdeployed health care as

well as sustainable transport.

Electronicsis an

essential element forvirtually all industries

Electronics is a field ofcompetence that holds the key to

the solutions many ofthe global

challenges we have to take on

in the future. Efforts made in this

area are therefore ofimportance

for the global welfare.

Electronics tend to be a bit

invisible as it is included and

embedded in so many various

industries and applications. Its a

common aim for all ofus in the

industry to promote the potential

ofthis industry.

TheSwedish Electronics

Trade Association is

collaborating with a number

of companies and

universities

to enhance theelectronics industry

In Sweden we are in the process

ofdoing ourlocal shareof this

work. In orderto make most

possible use ofthe potential

ofelectronics, the SwedishElectronics Trade Association

(SE) is collaborating with a

numberofcompanies, institutes

and universities in a project

aiming to enhance the electronics

industry.

The work is sponsored by

Vinnova (a governmental

organization for innovation

and growth). The project aims

to set an agenda forhow

Swedish electronics industry

is to keep its competence

and competitiveness.

The ambition is to set electronics

to be in focus forstrategic

innovation.

We are right up in the process

now and the results will be

presented later this year.

nApril 23rd in Paris,

the different French

trade associations*

of the High Tech Industry

regrouped to launch an initiative

called Agir pour lIndustrie

ElectroniqueorTakeAction

for the Electronicindustry.

Aninitiative

called Agirpour

lIndustrie

Electronique or

Take Action for

the Electronicindustry.

The event gathered over300

decisions makers fromour industry, Component

Manufacturers, Manufacturers

of Test equipments, Distributors

and generally all the suppliers

of the high tech industry along

with major OEMs and Contract

Manufacturers. This initiative is

meant to promote the industry,

defend the competitiveness of

the national actors and attract

new talents.

Thisinitiative

is meant to promote

the industry, defend

the competitiveness of

the nationalactorsand

attract

new talents

SPDEI is an active member of

this industry initiative.

Distributors connects

hundreds ofcomponent

manufacturers with thousands

customers - says Pascal

Fernandez VP of SPDEI - weplay

a key role in our industry

supporting the emergence of


18/31

Pascal Fernandez

EMEA Avnet Velocity

VP SPDEI

ww .spdei.fr

w companies, applications and

mulatinginnovations.

was a natural andobvious

oice for us to be a founding

rtner of this event.

anois Kurek, president

SPDEI, went on stage andscussed specifically the challenges

the Electronic industry supply

ain in France, and the evolution

er the recent years.

The French trade associations of

e High Tech Industry who took

rt to the event are:

FIE:

oupement des Fournisseurs de

dustrie Electronique

XEL:oupement des Industries de

terconnexion, des Composants et desus- ensembles

MTEC:

ndicat de lInstrumentation de Mesure,Test et de la Conversion dEnergie

ns le domaine de lElectronique

TELESC:

ndicat des Industries de Tubesectroniques et Semi-conducteurs

NESE:

ndicat National des Entreprises de

us- traitance Electronique

PDEI:

ndicat professionnel de la

stribution en Electroniquedustrielle
http://www.spdei.fr/http://www.spdei.fr/


19/31

E

ECIA web-site now

includes B.O.M facilityby Robin Gray

President and CEO [email protected]

ECIA strongly encourages

manufacturers to examine their

websites with these tips in mind:

CONSORZIO ELETTRIMPEX

LUMEN INTERNATIONAL

The Consortium

The Elint Consortium represents the interest of small and medium

companies in the electronics and lightingsectors

Mission

Its aim is topromote the interests of SMEs that export abroad

andto facilitate theirinternationalization

Activities

The Elint Consortium carries out activities aimed

at internationalizing member companies and theirproducts:

sFAIRS:Special events in the electronics sector in Europe andabroad

sMISSIONS:Market surveys on the selected

countries sFORUMS:In-depht meetings devotedto

technicians on specificsubjects

sDOCUMENTATION:Guides anddirectories

Partners

sASSODEL - ItalianAssociation of Electronics Suppliers

(representative of over 90% of components distribution)

sIDEA - InternationalDistribution of Electronics Association

CIAspopular inventory

search website has added

a new feature - a build and

materials (BOM) import/export tool.

Customers can now upload up to

100 part numbers to find inventory

price and availability from 50 of the

leading authorized distributors.

This new feature was the most

requested site enhancement from

customers. The tool exports a

spreadsheet that enables customers

to sort the returns by distributor,

quantity and price. During the soft

launch phase, this new feature has

become a popular tool for OEMs

looking for authorized inventory.

ww w .ECIAauthorized.com has also

become a popular destination for

customers looking to identify which

distributors are authorized for whichmanufacturers. ECIA continually

vets the list to ensure that only

authorized inventory is being listed.

Component manufacturers can do

their part in the fight against

counterfeit product by prominently

displaying on their websites a list of

their authorized distributors.

Make the list of authorized

distributors easy for find on you

website.

Make the link less complex with no

long, cryptic keys. A single link to a

single distributor is preferable. Make the list easily printable.

Customers often want to save or

print the page for theirrecords.

Identify distributors by region

and clearly note any geographic

limitations.

Provide a list by region rather than

a pull-down or search menu.

It is not necessary to list

distributor branch offices.

Clearly label your distributors as

authorized distributorsince this

will match the terminology used in

the standards and by ECIA.

If it is your company policy,

consider adding a statement to

your website reminding customers

that only product purchased

directly from you or from your

authorized distributors is covered

by your warranty.

Keep the list updated with new

authorizations and terminations.

Clearly indicate whether products

obtained by distributors throughmaster distributors and buying

groups are considered authorized.

These are important steps that

component manufacturers can take

to enable customers to find where to

buy your companys products and to

ensure the integrity of the authorized

supply chain.

CONSORZIO ELINT Via Console Flaminio 19 - 20134 Milan (Italy )Ph. +39 (0)2 2101111 Fax +39 (0)2 210111222 [email protected]

www.consorzioelint.it
mailto:[email protected]://www.eciaauthorized.com/mailto:[email protected]://www.consorzioelint.it/mailto:[email protected]://www.eciaauthorized.com/mailto:[email protected]://www.consorzioelint.it/


20/31

T

Changing business environment favours

Indian electronics manufacturingby Rajoo Goel

Elcinaww w .elcina.com

he Indian Government as

well as most stakeholders

- including industry

associations - have set an

ambitious target of achieving an

output ofUS$ 400 Billion for

electronics manufacturing by

2020. Hectic activity has been

going on to establish an eco-

system which would make thishappen.

Electronic Manufacturing Clusters,

Modified Special Incentive

Package,Preferred Market Access

and strategies forattracting

investments in electronics

manufacturing are all in the pipeline.

With a little luck, we will also have

our own semiconductor fabrication

unit very soon!

It looks like things are finally

coming together in favourof

manufacturing with external

factors complementing the internal

initiatives being taken in the

country.

India and China, the two most

populous countries in the world,

have diametrically opposite political

and economic systems.

This has resulted in India becoming

aservice oriented economy with

excellent individual skills and

entrepreneurship. However, India

lacks a strong manufacturing sector

which it desperately requires for

sustaining economic growth to

engage its vast population.

Indiahas set an

ambitious target ofachieving

an output ofUS$ 400 B for

electronics manufacturingby 2020

China, on the other hand, has

directed its economic activity and

focus to fast-track growth of its

manufacturing which over the past

decade has launched it from the

sixth largest to the second largest

economy of the world. It has

become the largest trade partner

to most nations and has more than

trebled its per capita gross national

income to almost US$5,000. One

of the not so fortunate outcomes of

this growth is the level of per capita

carbon emission, which now equals

that of the European Union, in spiteof China having more than twice

the number of citizens.

China has also witnessed an exit

of a large number of businesses,

especially those who are unable

to cope with the escalating costs

such as labour, energy, and the

value of the RMB which has been

controlled since many decades

giving an unrealistic cost advantage

to sellers in China. There is a very

different economic environment in

China with the economyslowing

down from the heady 9% and

more of earlier years. The scenario

here is neither dynamic nor

optimistic as itonce was.

One may wonder why the situation

for the Indian electronics industry

looks optimistic inspite of numerous

negative factors facing us. The

political future is anybodys guess

considering the vicissitudes of

coalition governance and the

struggle in implementing economic

reforms. The growth rate projections

continue to decline and have

reacheda not too encouraging

figure of5% compared to a robust8-9 percent barely 24 months ago.

Considering specific factors

impacting industry, there is no

reduction in input costs such as

finance, energy or logistics and the

rupee has depreciated considerably

reducing the competitiveness

of Indian import dependent

manufacturers.

Forthe first time a

comprehensive national

policy has been rolled out

in supportofmanufacturing

If we look a little further, we may

possibly find an answer to our

question - why are we optimistic

about the fortunes of the Indian

electronics industry?

For the first time a comprehensive

national policy has been rolled

out in support of manufacturing.

Inspite of numerous roadblocks

and delays, there is no denying that

extraordinary progress has been
http://www.elcina.com/http://www.elcina.com/


21/31

ade and three of the key policies have

en approved and are ready for

plementation. The remaining parts -

search & development, National

ectronics Mission, Semiconductor Fab

care all

process and we are convinced that

e government will be able to roll them

t soon. Till about five years ago,

ere was no attractive alternative to

ina.

Indialacks a strong

manufacturing sector

ost of Far East and South East Asia

ve become cost prohibitive barring a

w countries such as Vietnam,donesia and possibly the

ilippines. However, none ofthem

ovide an alternative

China! India with its vast land

ass, human resource and now its

rgeoning market, are looking

ddenly attractive.

s for India to reach out

h confidence and grab this

portunity. The government and

dustry have to come togetherand

ork in tandem and provide

surance to investors. A recent visit

Germany revealed that the west is

oking towards us for

portunities. They face an adverse

onomic and demographic situation

their markets and have faith in the

dian democratic system.

owever, they are not sure about our

vernance and whetherwe canliver what we promise. Ifwe can

liver on our promises and policies,

y would not be the limit for Indian

ectronics in the next decade.


22/31

C

byAmy Wang

Member of the CEDA Board

ww w.cedachina.org2013 CEDAExecutive

Conference to be held in Xian

hinas electronics industry

turns to higher value-add

and industrial applications

that require more segment supply

chain supports. The developed costal

electronics manufacturing sectors

are challenged by reduced export and

increased costs, and West and

CentralChina embraces relocation of

R&D and manufacturing facilities from

Xianis Chinas

power house of

industry, military,

smart grid R&D andmanufacturing centers

RUTRONIK JOINS CEDA

both local and international OEM/

EMC, powered by rich engineering

resources and lower costs. It makes

West and Central China move to

combined R&D and manufacturing

features of industry, communications,

smart grid, automotive, medical and

military applications.

2013 CEDA Executive

Conference (Xian) is developed

to serve Chinas increased design

activities and enhance strategic

cooperation through top executives

communications. It is held in

critical timing because West China

is facing challenges of inadequate

supply chain supports to support

its increasing design activities.

Xianis Chinas power house of

industry, military, smart grid R&D

and manufacturing centers that

has great influence on neighboring

provinces of Gansu, Sichuan,

Shanxi, Ningxia and Hubei. In the

past, the regional supply mainly

serves government demand, but

now it must meet free-market

demand in China.

CEDAis an organization

of leading China franchiseddistributors

CEDA is an organization of leading

China franchised distributors. We

understand that West and Central

China needs segment electronic

supply chain services-authorized

distribution service, low volume/high

mix purchasing service, hard-to-find

parts, obsolete component supply

chain development in West and

Central China, special demand of

manufacturers, research institutes

and academic bodies, as well as

strategies and action to meet the

new demand. The conference will

also bring interactions between

top executives from component

manufacturers and distributors to

better serve the market and expend

service network in the new area.

Time: August 28, 2013

Venue: Green Land Holiday Inn,

Xian

Focuses and Themes:

West China supply chain

development strategies update

Electronics distribution service

opportunities and challenges Segment supply chain demand

trends

Low volume/high mix supply

China Electronics Distributor Alliance (CEDA) announced today that Rutronik

Elektronische Bauelemente GmbH officially joined CEDA after approved by

the CEDA executive board members.

Lambert Hilkes, General Manager of Rutronik Asia said: We strongly

supportCEDA and expect to work together with CEDA to enhance standards

andregulations in Chinas distribution area. On August 28, I will participate

CEDA executive conference in Xian. West China is always our important

marketfocus andithosts many of our clients. We expect to serving China

design engineers with high quality products and services and accelerating

China innovation activities.

Wenhai Chen, Vice President of China Electronics Appliance, CEDA executive

board member said: We welcome Rutronik join CEDA! Rutronik has been

exhibiting at our West China Electronics Fair in Chengdu and supportingwest

engineers design and purchasing needs in the area of industrial, renewable

energy and automotive electronics area, which help Chinas update ofour

electronics industry.

Dr. Michael Liu, CEDA Secretary General, CEO of CNT Networks said:

Its very meaningful to have Rutroniks supports to CEDA because Rutronik

willbring advance experiences and quality standards to CEDA. CEDA focuses

on serving franchised distributors in China in terms of bridging CEDA

members with suppliers and OEM/EMS companies, and enhancingestablishmentofstrategic partnership to serve Chinas electronics industry.

We saw Rutronik is also help local Chinese component suppliers to expand

business in European market. Last December, Rutronik set up global

strategic cooperation with BYD Microelectronics to sell BYDs microelectronics

products globally. This is veryhelpful for Chinas electronics component

suppliers! and product life cycle management. Those

are CEDA member specialty service areas

and business opportunities. We developed

this event to enhance communications and

accelerate strategic partnership among top

executives, supply and demand,

government officials and companies.

2013CEDA Executive

Conference (Xian) isdesigned

to serve Chinasincreased

design

activities

This conference will serve governments

initiatives of supply
http://www.cedachina.org/http://www.cedachina.org/http://www.cedachina.org/http://www.cedachina.org/


23/31

service trends

Design outsourcing trends

Online component sales opportunities

Supplier and distributorrelationship development

Contact: [email protected]

Two Fortronic technical events: RF& Wireless, Power and Power

Management will be conducted in Xian following the CEDA Executive

Conference to serve Chinas emerging markets.

Please contact:[email protected] formore details about

these events.
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


24/31

M

The Fortronic story

gets better and better!

a good conversation in a relaxed

and informal atmosphere. The

venue and organisation was great.

We had sponsors flying in from

Germany and the USA atthe

last event, which illustrate the

significance of these events- said

Harvey.

otiv8, the operator of

the Fortronic UK forums

are reporting a fantastic

start

to 2013 and big plans for2014.

With LED & Lighting held on

March 25th in Oxford, PR DirectorHarvey Osborn said we are

very pleased with the first halfof

2013, the most recent eventhad

over 100 attendees, with 90% of

engineers being first time visitors,

and a full house ofsponsors.

Harvey went on to say The forum

format is clearly the wayforward,

what we offer is a strictly targeted

day of delivery with every single

attendee being vettedfor

relevance, we even turnpeople

away, this ensures both sponsor

and attendees get the verybest

out of the day, and everyone

goes

away totally satisfied that their time

and money has been wellspent.

From the most recent post event

feedback Motiv8 have captured

the following comments:

From simple, to the point

comments like - what a very

well- run event.

To fantastic comments like - I

have met more relevant

engineers in the last hour, than I

did in the lastmonth.

And more detailed feedback like -

Thank you all for the invitation to

last weeks forum - anothergreat

event, some of the speakers in the

morning were very good and the

afternoon workshops excellent - as

before I came away having learned

a lot, and I also managed to find

the missing piece for aproject

that Im working on -All in all, a

great venue, great people, great

food and very useful forproduct

development, welldone.

To - Reallygood mix of customers

with everyone having a genuine

interest in being there.Although

we knew some of the customers,

we were able to meet the key

people, decision makers, and have

With RF & Wireless Design taking

place on June 25th, and Power &

Power Management on October

22nd , both at the Williams F1 centre

in Oxford, it seems that Motiv8 have

2013 nicely mapped out.

I have met more

relevant engineers in the

last hour, than I didin the last month

Motiv8 have recently teamed up with

the IED (Institute of Engineering

Design) with a partnership

arrangement between the twoorganisations, We have our

Electronics industry media partners,

however as part of our plan to

further expand the UK events we

wanted to team up with a much

broader business, the iED was a

perfect fit, and will bring exposure

to a much larger and more diverse

audience.

Moving forward Motiv8 have plans

to increase the UK forums for 2014,

with Scotland already confirmed for

February, and plans underway for a

Midlands event, Harvey added

Oxford has proved to be a great

venue, and our research has shown

that attendees are traveling from up

to a 2hour radius, which cuts out a

massive section of the country, over

the last8months we have been

researching other UKlocations,

with Scotland confirmed, andtheMidlands still in research, 2014 is

going to be a very exciting year

with between 6and9 forums

planned.


25/31

r info: ww w .fortronicuk.com
http://www.fortronicuk.com/http://www.fortronicuk.com/


26/31

D

Authorized Distribution versus

Counterfeit Partsby Lou Lipomi

Bishop &AssociatesManaging Director- DistributionResearch ww w .bishopinc.com

uring last years second

presidential debate,

Governor Romney said,

Theres even an Apple store in

China thats a counterfeit Apple

store, selling counterfeitgoods.

As it turns out, there is indeed a

store in Kunming, China, that for alloutward appearances is an Apple

Store. The architecture, fixtures,

anddisplay areas are almost

indiscernible from the real thing,

andthe employees wear the iconic

blue t-shirts and authentic looking

lanyards, which interestingly do not

include their names. There is even a

spiral staircase. The only giveaway

may be the words Apple Store

over the entryway. RealApple

stores display only their glowinglogo.

Unfortunately, this is far from

the only counterfeit Apple store.

Hundreds of stores that are neither

owned nor authorized by Apple

exist in almost every country around

the world. As with many other

counterfeit efforts, some fakes are

easierto spot than others.

The store in Kunming is hard to tellfrom the real thing.

A similar operation in Qingdao,

however, would not fool even the

most casual passerby. Editors

comment: since this article was

prepared a further 22 fake Apple

stores have been found in just

Kunming alone and it transpires

that, in the first fake Apple store,

the employees thought they were

working for Apple! Source BBC

News 29

th

April 2013).

Accordingto the

International Chamberof

Commerce (ICC),

the totalvalue of

counterfeit goods was

expected to exceed

$1.7 trillion in 2012

THE COUNTERFEITING EPIDEMIC

In one sense, the counterfeit

Apple stores and the products

they sell can be compared to the

Rolex watches you can buy from

pushcart vendors everywhere from

Hong Kong to New York. Most

consumers know, or should

know, that they cant buy a real

Rolex for

$35 or a Louis Vuitton bag for$15.

By all accounts, the tech-savvy

Chinese consumer knows the

Apple products have not come

through official channels.

But if there is little chance that any

of these products present a safety

risk, whats the harm?

The most significant impact is, of

course, the revenue lost by the

designer and manufacturer of thegenuine item. According to a recent

estimate by the International

Chamber of Commerce (ICC),

the total value of counterfeit goods

was expected to exceed $1.7

trillion in 2012.

The ICC says that consumer

electronics represent one of the largest

counterfeit categories, with a dollar

value estimated

to exceed $2.5 billion. Otherproduct

categories with significant counterfeiting

activity include fashion clothing and

accessories,jewelry, watches, and digitalmedia,as well as perfume, which

is particularly disturbing in that it is

reportedly made, in many cases, from

horse urine.

ELECTRONIC COMPONENTS Tryingto sort

out the complicated issue ofcounterfeit

electronic components ismuch more

difficult than identifying areal Apple store.

Many fakecomponents are illegally marked

witha recognized suppliers logo and part

number. In the image below, the part on

the left is the original. The part on the right

is

a slug consisting of nothing but plastic

and metal. Like the Apple store in

Kunming, unless you know what youre

looking for, it is very hard to tell the

difference.
http://www.bishopinc.com/http://www.bishopinc.com/


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In the case of the Atmel chip,

the product in which it is

installed would simply not

work. Replacing a 6,800-

microfarad capacitor with a

2,200-microfarad, however,

could cause serious and

perhaps dangerous results.

Still other products, while

posing little or no danger,

can definitely reduce

performance. A consumer

paying a premium for the

performance of a Monster

brand cable would be quite

disappointed if he were to endup with the unshielded

product below on the left. The

only way to determine

the cause of the potential poor

performance, however, would

be to actually destroy the cable

assembly by cutting away the

overmolding.

COUNTERFEITING METHODS

There are as many sources of

counterfeit parts as there are

definitions. All of these

products, however, are

included in the umbrella

description of counterfeit.


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The list includes parts made by

unauthorized suppliers to look like

the genuine article. Most, ifnot

all, of these are ofsubstandardquality. There are also parts that are

mislabeled, have some functionality,

but dont meet the specifications of

the part number listed on the label.

In some cases, counterfeits are

scrapped parts that dont meet spec

and were supposed to be destroyed

by the manufacturer, but instead

found their way into the supply

chain. In some cases, components

are ripped off old printed circuit

boards, cleaned up, and sold as

new parts. According to Robin

Gray, executive vice president

of the Electronic Components

Industry Association (ECIA), This

is happening more because of the

growth of recycling of electronic

equipment.

Thebulk of counterfeit

parts enterthe supply

chain because ofsome

unscrupulous brokers and

independent disti

who sell fake parts

Reverse engineering is another form

of counterfeiting that has a strong

impact on connectors.

Bob Hult, director ofproduct

technology at Bishop &

Associates,said, Counterfeitersmay be tempted to reverse-engineer

legacy products, as well as emerging

interfaces, to enable them to

participate in volume markets. This

may be particularly true of small

offshore garage shops that have no

development resources, but do have

access to molding machines and

hand-assembly labor.

INDEPENDENT DISTRIBUTORS

Gray believes the best way

to thwart counterfeiters is for

buyers at OEMs and electronicsmanufacturing services (EMS)

providers to buy directly from

component manufacturers or

authorized distributors: The bulk

of counterfeit parts enter the

supply chain because of some

unscrupulous component brokers

and independent distributors

who sell fakeparts.

Debra Eggeman, general manager

of the Independent Distributorof

Electronics Association concurred,

but added, Many members have

robust screening and testing

procedures and have invested

in test equipment to weedout

counterfeit and substandardparts.

One organization trying to address

the issue is ERAI, a privately

held global information services

organization that monitors,investigates, and reports issues that

are affecting the global supply chain

of electronics. ERAI is comprised of

original component manufacturers

(OCMs), original equipment

manufacturers (OEMs), distributors

(authorized and independent),

contract manufacturers (CMs),

government agencies, and

associations serving the industry.

They maintain a database ofhigh-

risk parts and provide members

with access to a list of known

problem areas.

Most Independent Distributorof

Electronics Association member

distributors are clear about their

business models. They use terms

like obsolete, excess inventory,

and hard-to-find to define the

products they sell.

Most also address the counterfeiting

issue and their efforts to inspect

products on their websites. Others

do indicate the lines forwhich

they are authorized, listing others in

a separate section of their site.

Several, however, include line cards

that are not clearly indicated as

authorized by the supplier. Once

again, it is up to the consumerto

carefully evaluate both the product

and the source before they order.

AUTHORIZED DISTRIBUTORS

Authorized is definitely the word

to look for. A search of Independent

Distributor of Electronics Association

-affiliated distributor websites did not

uncover any misuse of the word.

Conversely, ECIA members

typically refer to themselves as

authorized distributors and display

the authorized source logo on their

websites, including it in all their

advertisements and publications.

ECIA has an active program

to educate consumers about

Section818 of the

National DefenseAuthorization Act is now

being phased in. One

of the requirements will

require DNA marking on

electronic microcircuits

managedby the Defense

Logistics Agency

counterfeit parts and how to avoidthem. They also work with suppliers

to help them indicate clearly what

it means to buy from an authorized

distributor as well as to identify who

those distributors are.

They urge suppliers to list their

authorized distributors on their

website and to clearly state that

only products bought directly or

through an authorized distributor

are covered by their warranty.Theyalso host a website,

ww w .eciaauthorized.com, with a

search tool that returns a list of

ECIA member authorized sources

for requested part numbers.
http://www.eciaauthorized.com/http://www.eciaauthorized.com/http://www.eciaauthorized.com/


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LOU LIPOMI

Lou Lipomi joined Bishop & Associates

Inc. in 2010. As the managing director,

he is establishing a new division forBishop & Associates focused on the

connector distribution channel. Lou

has more than 25 years of sales and

marketing experience in the interconnect

industry.

Lou can be reached at

[email protected]

SAEIn 2009, SAEs Counterfeit

Electronic Parts Committee

(G19) published Standard AS5553,

which addresses the avoidance,

detection, mitigation, and

disposition of counterfeit electronic

parts. The standard, which is

not certifiable, is recommended for

use by all organizations that procure

electronic components and

assemblies. SAE is now working ona new standard, AS6081, that will

specifically address distribution.

The new committee, Counterfeit

Electronic Parts Avoidance

Protocol, Distributors (G19d),

includes OEMs, independent

distributors, ERAI, and the

Independent Distributorof

Electronics Association , as well as

IDEA NEWSLETTERINTERNATIONAL DISTRIBUTION OF

ELECTRONICS ASSOCIATION

EDITOR IN CHIEF: Gary Kibblewhite

EDITORS:Adam Fletcher (UK); RajooGoel (India); Robin Gray (USA); Ivan

Pokrovsky (Russia); Franco Musiari

(Italy); Lena Norder (Sweden);

Georg Steinberger (Germany);Amy Wang (China);

PUBLISHER: Silvio Baronchelli

INTERNATIONAL PROMOTION BY:

CONSORZIO ELINT

PUBLISHED BY:

Tecnoimprese Scarl - Via C. Flaminio, 19 - 20134 Milan - ItalyPRINTED BY: Servizi Tipografici Carlo Colombo - Rome

representatives from TTI, Mouser,andArrow.

Itis up to the

consumer to carefully

evaluate both the

product

and the source before

they order

The primary focus of the standard

will be to recommend counterfeit

parts avoidance requirements

directly applicable to distributors.

The intent is to define a program

that would establish and maintain

a certification forelectronic

components distributors whose

regular use of anti-counterfeit

controls in their operations ensures

delivery of authentic products

that meet original componentmanufacturer specifications.

An important part of any such

program will be a clear delineation

of how the protocol should apply

to the different types of distributors.

To that end, authorized distributors

would not be required to perform

exhaustive testing on products

for which they have documented

traceability. In other words, if they

buy a component directly from the

manufacturer, they would not have

to perform any additional testing.

The only possible path for

counterfeit parts to get into an

authorized distributors inventory

would be through the return

process, and all authorized distributors

have strict controls in place for this

eventuality.

A typical program, as described by

Kevin Sink, vice president

of total quality forTTI, requires that all

products returned from a customer be

quarantined until they can be scannedfor

valid labeling identifiers. If a partdoes not

pass this inspection, thecustomer is

notified and given theoption of eitherhaving the parts sentback to them or

having TTI scrap theparts on their behalf.

DNA (YES, THAT DNA!)

Section 818 of the National Defense

Authorization Act (NDAA) is now being

phased in. One of the requirements

related to the act will require DNA marking

on electronic microcircuits managed by

the Defense Logistics Agency (DLA).
mailto:[email protected]:[email protected]


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The DLA considers microcircuits

to be at high risk for

counterfeiting and notified

suppliers in August 2012

of the new requirement, which

will apply to items within

Federal Supply Class 5962.

The DLA has authorized Applied

DNA Sciences to provide a

signature mark consisting of

botanical DNA. The mark can be

either visible orinvisible. In many

cases, the ink

used to mark the part will be

infused with the DNA material.

Will the counterfeiters be able to

develop a method to get by

DNA detection?

According to Janice Meraglia,

vice president in charge of

military and government

programs for Applied DNA

Sciences, the answer is no:

Weve had some prettystrong

entities tryto copy what were

doingand no one has been

able to do

it. We use plant-based DNA

anditsjust as strong or

stronger than human DNA.

The counterfeiters willnot be

able to breakthrough.

Only time will tell...


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Discoverthe future of supply chain data exchange

Product compliance &sustainability data

in a one-stop solution

Sustainability data exchange hub (SustainHub) is a research project

with the goal of developing an integrated network solution for

managing product compliance and sustainability data across the entire

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The SustainHub project is supported by funding of the European

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Research Theme: Environment.

IDEANewsletter May2013 LH

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