China’s vibrant “shanzhai” (also “shanzai”) industry, which modifies or knocks off existing electronic products, quickly pounced on the iPad as it did many other phones and devices. Shanzai.com, a site that reviews these ersatz gadgets, reported the first iPad clone in March. Since then the faux iPads have reportedly been selling like crazy. “China’s shanzhai industry is rolling out ‘iPads’ faster that people can say ‘one gig or two’!” CNNGo wrote in June.
But months after the iPad’s release, Chinese news media are reporting that the market for fake iPads has slowed dramatically. Why?
Lax intellectual property enforcement has fueled China’s scrappy shanzhai industry, especially for consumer electronics. Shanzai phones and gadgets are often cheaper, more available and may come with creative twists, like the inPad’s multiple USB ports or the slide-out keyboard that doubles as a stand on an unnamed, but clearly iPad-inspired, tablet device.
But cleverness is not enough for Chinese consumers. “Yes, iPads are hot, but Chinese manufacturers are learning that producing knock-off gadgetry is not as profit-making as it used to be,” the Chinese news agency Xinhua reported this week.
The first knock-off iPad reviewed by Shanzhai.com
The reason? The rising cost of labor and parts is driving up the cost of knockoffs, leading to lower demand for the fake goods. A similar trend happened last year with knockoff netbooks, Xinhua reported.
A $499 iPad smuggled in from the US is priced at 4,500 yuan, or $660 in mainland China, Xinhua reported, while fake iPads range from 600 ($88) to 3,000 yuan ($442).
The real iPad is not available in mainland China yet. But Apple started selling iPads in Hong Kong on July 23, where they retail for the same price as they do in the U.S. – and are selling like hot cakes.
