Seagate technology, in collaboration with IBM, plans to use blockchain technology to prevent counterfeiting of hard disk drives.
Reportedly, Seagate has a huge counterfeiting problem which poses serious challenges both for retail customers and for users, making it difficult to distinguish the original hardware from the fake.
But the problem is even bigger than this. Not only are the counterfeit products showing up on online platforms like eBay, but they are leading to a reverse supply chain wherein customers return counterfeited products to the company. This way, even Seagate is at risk of accepting fake products back into its own supply.
An Attempt to Streamline the Computer Hardware Supply Chain
According to an estimate by the International Anti-counterfeiting Coalition, global trade in pirated and counterfeited electronic products amounts to more than $1.7 trillion.
To fight this, Seagate and IBM are creating an electronic fingerprinting system based on blockchain which will be shared with the relevant parties. This will make sure that all the trading parties receive authentic products.
Seagate will update theIBM blockchain platform on the IBM cloud with product identification data right at the moment of manufacture. Each product will be associated with its own Seagate Source Electronic ID (eID). This way, each product can be verified using this id throughout its lifecycle.
The IBM blockchain platform is powered by the Linux Foundation’s Hyperledger Fabric distributed ledger framework and would allow the participants with required permissions to change and view blockchain data.
This would undoubtedly help in reducing data loss, warranty costs and would eliminate fraudulent products from the cycle, while also improving product assurance.
The global managing director for the electronics industry at IBM, Bruce Anderson, stated that “Blockchain technology can be extremely effective in confirming provenance and authenticity of assets.”
He further added, “The ability to work with Seagate to combine blockchain with advanced cryptographic product identification technology is what sets this work apart and signals blockchain’s potential to reimagine the electronics product lifecycle management processes. Counterfeit electronics components are a global issue that requires an ecosystem-wide effort to address.”
The senior vice president at Seagate said, “IBM has a proven history of technology innovation, as evidenced by its market leadership in blockchain technology for product provenance in various industries.”
As the project development proceeds ahead, it is expected that Seagate and IBM will also include supply chain partners in their business network.
Undoubtedly, if this proof concept turns out to be successful, it would be a big success and would streamline the computer hardware supply chain to a large extent.