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The Real Thing?

Irate over losses from forgeries, frauds, and knock-offs, corporate executives apply a little technology to the problem.

1May

What true fan wouldn't pay a king's ransom to own the football that decided the New England Patriots's 2002 Super Bowl victory? More than 130 million television viewers watched that ball sail through the uprights for the historic field goal, but what they didn't see was the mark proving it was a genuine Super Bowl game ball. That's because it was tagged in invisible ink, which in turn was laced with synthetic DNA — part of the National Football League's effort to protect its memorabilia from counterfeiters.


The NFL is not alone. According to the International Anti-Counterfeiting Coalition, Fortune 500 companies spend an average of $2 million to $4 million a year fighting counterfeiting, and some spend as much as $10 million. The problem goes well beyond knockoffs of watches and upscale pocketbooks: The software industry loses an estimated $12 billion to $16 billion per year in sales; auto-parts manufacturers lose $12 billion. Sometimes more than sales are lost — investigators of the deadly American Airlines crash in the Rockaway area of Queens, N.Y., last November now suspect the cause may have been a used part that was packaged and resold as new.


The response to counterfeiting in general has been a new wave of both overt and covert authentication marks on products. DNA Technologies, the company that provided the ink for the Super Bowl balls, also provides ink for the labels of Australia's Hardy's Wine — laced with DNA from the grapevine itself. Insurer Marsh, meanwhile, now offers insurance to help companies pursue trademark counterfeiters in court.


Such measures also help manufacturers battle the so-called gray market, in which authentic products are diverted to distributors that sell them at unauthorized discounts. "Gray marketing has more of a direct financial impact on a company's P&L than counterfeiting," notes Stephen Polinsky, co-founder of Boston-based GenuOne. "If there's a stream of cheap product in your supply channel, your factory won't receive as many orders." In addition to providing DNA-coded ink markers to companies, GenuOne will track coded products and monitor sale prices.

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