Thursday, December 1, 2011

Indonesia - online fake goods traders

The Jakarta Post on Tuesday interviewed an online seller of counterfeit goods. She said that knockoff clothing, such as copies of Topshop, Zara, Mango and other international brands, which she calls ‘replicas’ instead of counterfeits are good business. "The Replicas are 80 or 90 percent identical to the originals, with similar materials and intricate stitching, almost as great as the originals.”

This 20 year old woman reminds IP Komodo, that Indonesia and other emerging markets are late to the online distribution game but catching up rapidly. Her business is consumer driven, so she uses BlackBerry groups and Facebook extensively to market - Indonesia is one of the world's leaders in social network growth. B2C volumes might be relatively low, but demand is regular and constant.

Now we are starting to also see the B2B platforms like - see image - appear too, which enable online distribution on a larger scale, equivalent to Alibaba and Taobao in China. Young internet savvy entrepreneurs relying on the Internet for business opportunities are driving a healthy trade in fakes as shown by the Jakarta Post article.

But just as in China, the IP enforcement system is too blunt a tool. It struggles to take useful, cost effective action against online sellers. They are hard to trace, do not hold large stocks, and may have no legitimate business entity, or records. IP holders mainly focus on using ISP takedown notices to remove items to lower these traders' visibility and disrupt their operation. Customs in SE Asia is not effective. So it continues be a struggle to do more, whether in China or Indonesia to track down and take legal action against all these one man band internet driven infringers.

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