Counterfeit IT equipment makes the “gray market” treacherous for data center operators.

Bob needed a new server for a small virtualization project, and his regular value-added reseller couldn’t budge on the price. He shopped around and stumbled across a great deal on the same server make and model offered by a little outfit out of state. There were no obvious red flags, and Bob placed the order. The server arrived and worked as expected. It wasn’t until several DIMMs started failing that Bob checked the parts carefully, only to discover that the DIMMs were not actually made by the manufacturer advertised. After checking serial numbers back to the server manufacturer, Bob discovered that the little value-added reseller (VAR) with the great price wasn’t even an authorized reseller, and the manufacturer promptly billed Bob for the support call. Bob, like thousands of other IT professionals, had become a victim of a growing problem: the IT equipment “gray market.”

There are several ways to define the IT gray market: used, poor-quality and counterfeit. The used equipment market, sometimes called the “secondary market,” is an established and perfectly accepted means of liquidating old or excess IT equipment. For example, when equipment is refreshed in the data center, the old equipment that is removed is often sold off to the secondary market, which then resells the equipment as “used.” It’s an excellent way for businesses to obtain replacement parts for older systems that a manufacturer no longer supports, but that you cannot yet upgrade or replace.

But there is a darker side to the gray market, where poor-quality components or outright counterfeit components are incorporated into a product without the buyer’s knowledge, and this is where we’ll focus attention. A poor-quality component may be entirely legitimate and marked honestly from a supplier, but simply lacks the characteristics or reliability needed for the system where it’s used. A counterfeit component is even worse, designed and marked to simulate another manufacturer. A good counterfeit may be impossible to spot without a close inspection.

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