The deadly hacking of Hezbollah’s Asian-branded pagers and walkie-talkies has sparked an intense search for the route of these devices, revealing an obscure market for older technologies where buyers have little assurance of what they are getting.
Analysts and consultants say that while supply chains and distribution channels for high-margin, new products are tightly managed, that is not the case for second-hand electronics coming from Asia, where counterfeiting, excess inventories and complex contract manufacturing deals sometimes make it impossible to identify the source of a product.
The response by the companies at the centre of the bombings that killed 37 people and injured nearly 3,000 in Lebanon this week has underlined the difficulties in understanding when and how they were weaponised.
Taiwan-based Gold Apollo blamed a European licensee of its pagers, sparking investigations into the origins of the deadly devices in Hungary, Bulgaria, Norway and Romania. Japan’s Icom said it could not say whether walkie-talkies bearing its name were genuine because the market was flooded with counterfeits.
“If the supply chain was compromised to put the explosives inside … that’s incredible engineering to do. But the actual supply chain compromise isn’t that hard. Probably the easiest part was the supply chain compromise,” said David Fincher, a China-based technologist and consultant.
He said counterfeit products are prevalent, especially in large manufacturing hubs like China, where counterfeit components can be produced easily. He said it is not uncommon for counterfeit components to lead to supply chain compromises.
“As a technologist I can tell you it’s not that hard to put a little explosive in a radio.”
Hezbollah acquired the devices about five months ago, according to a security source, adding that the armed group thought it was purchasing the pagers from Gold Apollo.
The handheld radios, which the source said were purchased at the same time as the pagers, bore the name of Osaka-based Icom and the phrase “Made in Japan,” images of the exploded device showed.
Both companies have ruled out the possibility that the deadly components were manufactured in factories in their home states.
Taiwan’s Economy Minister Kuo Jih-hui has also said that the components used in the pager that exploded in Lebanon were not made in Taiwan.
According to a letter to the UN Security Council by Lebanon’s mission to the UN, initial examination of these devices by Lebanese authorities found that the explosives had been implanted in them before they reached the country.
fake goods
But, so far, no one is sure. It is unclear when and how pagers and walkie-talkies were weaponized so that they could be detonated remotely.
Joe Simon, a partner at Chinese intellectual property firm East IP, said part of the problem is that smaller brands invest less in controlling counterfeit products, mainly because of the cost, which can impact their profitability.
“The authorities are happy to deal with low-tech counterfeit products, but IP owners need to monitor, investigate and file complaints and this doesn’t always happen as much as it might with high-tech and big technology brands,” he said.
One problem for Icom is that it stopped making the IC-V82 model a decade ago, about the same time it began making holographic stickers to protect against counterfeit products, the company said.
The company has long been warning about counterfeit products, especially its older models.
In fact, according to the latest available report from the Japan Patent Office, more than 7% of firms in Japan reported business losses from counterfeit products in 2020, with nearly a third of these cases linked to China.
Icom urges customers to only use its official distributor network to ensure they are purchasing genuine products.
But according to a Reuters investigation, there are dozens of shops in China selling Icom brand walkie-talkies on e-commerce platforms such as Alibaba.com, Taobao, JD.com and Pinduoduo, including in some cases the IC-V82 model.
Of three China-based sellers of Icom products on Alibaba.com, none of which were listed as official suppliers on Icom’s website, Guangzhou Minxing Communications Equipment Co. and Chengdu Bingxin Technology Co., Ltd. both said they sold authentic products, while Quanzhou Yitian Trading Co. admitted to selling “Chinese-made counterfeit products” in addition to original products.
Icom has said it makes all of its products at its factories in Japan. It did not immediately respond to a request for comment on Icom-branded products sold on Chinese online sites.
A Reuters investigation showed that the discontinued IC-V82 model is also sold on e-commerce platform Shopee in Vietnam, indicating widespread availability of such products.
For Gold Apollo, which licensed its brand to Budapest-based BAC, the supply chain turned into a mysterious production path that authorities in various countries are now trying to understand.
“The widespread availability of cheap, second-hand manufacturing equipment means that counterfeiters have been able to move beyond single components to creating full-fledged products,” said Diganta Das of the University of Maryland’s Center for Advanced Lifecycle Engineering, who studies counterfeit electronics.
“I would no longer call it counterfeiting, it is more like illegal manufacturing,” Das said.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
