Press

 

19.12.2001 - Wedemark

Interview - Stopping Product Piracy at its Roots

Sennheiser and Shure, the two biggest companies in the microphone industry, have for the first time united in their fight against product piracy, and their campaign has the support of the Administration for Industry and Commerce (AIC). In a background interview, Rolf Meyer, President of Marketing and Sales at Sennheiser electronic GmbH & Co. KG, explained Sennheiser's position on the subject of product piracy:

Is product piracy a serious problem for manufacturers in the music industry?
Product piracy is a problem for all industries that produce high-quality goods. It affects not only luxury goods but also complex technical products which are copied cheaply using poor quality materials. Experience of this problem gained above all by other industries clearly shows that pirated products are aimed mainly at the mass market.

The microphone market has until now not been particularly in the focus of product pirates. But with the development of new, more efficient microphones which appeal to a wider group of users, this situation is changing. Product pirates are now also trying to attack the microphone market.

Which Sennheiser products are particularly affected?
The product pirates are especially interested in the evolution series, which has been particularly successful since its market launch in 1999.

In which markets have pirated products turned up so far?
So far, we have discovered individual cases of forged Sennheiser products in the Asian market, above all in China.

How did Sennheiser become aware of these forgeries?
Pirated products cannot be recognized at first glance – this makes it hard for the customers to see that they have been duped. It is only when they use the microphone that they will notice the very poor sound quality. We have the obligation to provide our customers with a high quality standard. This applies not only to our products but also to the service that is provided by local service and sales partners. Our trustworthy partners observe what is happening on the market very closely and inform us immediately when forgeries turn up. Furthermore, we employ local agents who monitor the forgery market. These reliable employees have enabled us to build up a closely-knit information network.

This effective infrastructure also allows us to react very quickly on an international level. Consistent and rapid behavior on our part prevents the problem from spreading. The forgers then have practically no chance to place their products on the market.

How does this work in practice?
We obviously can’t give any detailed information on this as it might impede the work of our employees. But it is important to point out that the work of these professionals is not regional or limited to a particular country. We monitor the market world-wide.

How do local authorities react?
Our experience is that the authorities in each country are very cooperative and also have a great interest in putting an end to product piracy.

How much damage has been caused to the industry so far, and to Sennheiser in particular?
Thanks to the systematic market monitoring that we have been carrying out for a number of years, we were able to stop product piracy in our industry very early on.

For our sector and our company in particular, the damage caused has been relatively negligible. Other industries, for example the software industry or the watch industry, have been much more seriously affected. They suffer losses to the tune of billions of dollars every year. In addition to the loss of sales, they also suffer from the customer’s loss of confidence in their products, which in some cases is permanently destroyed. Disappointment about an inferior, forged product can also have a negative effect on the customer’s decision to buy original products. The good name and image of the manufacturer can suffer long-term damage.

How can you give customers the security that they are getting an original pro duct from their dealer?
Firstly, our packaging ensures that our customers receive an unmistakable original product. Secondly, the products themselves have features which provide the customer with maximum security. We use the very latest technical processes and employ security experts to ensure that we always remain several steps ahead of the forgers and make sure that our products remain unmistakable.

What role does cooperation with your competitor Shure play in combating product piracy?
Product piracy is an immense problem which damages the reputation of the whole industry. Therefore it is only logical to work together with our competitors in planning and implementing effective action against a common opponent. Sennheiser and Shure, two of the largest companies in the microphone industry, are cooperating to form a powerful team that gives product pirates no chance of damaging an expanding market like China.

As far as Sennheiser is concerned, work to combat product piracy even goes beyond the bounds of our own industry. We firmly believe that the forgery of any type of product causes major economic damage. It also includes the destruction of jobs and social security. This applies not only to the companies whose products are being illegally copied but also to those people who work for the forgers in their factories. They are poorly paid and risk losing their job at any time. For that reason, we are actively involved in the work of the APM – ”Aktionskreis Deutsche Wirtschaft gegen Produkt- und Markenpiraterie e.V.” (German Industry Action Group Against Product and Brand Piracy), which also includes other renowned companies such as Audi AG, Robert Bosch GmbH, DaimlerChrysler AG as well as Henkel AG, Siemens AG and Volkswagen AG