Makers of fake electronics goods are fast turning their attention to tablets and smartphones as they grab an increasing share of the Chinese market.
Known as "shanzhai" (or "pirate") companies in China, they are operating more than 1,000 factories alone in the southern metropolis of Shenzhen, which sits just over the border from Hong Kong.
Apple's iPad currently holds more than 70 percent of the Chinese tablet market, according to a recent report by electronics industry watchers Analysys International, but that figure apparently declined by more than five percent in the second quarter of the year, a trend the report puts down to a rise in both legitimate and illegitimate competitors.
Close to two million of the fake "white boxes," as they are known in the industry, were sold in China over the first half of 2011, according to another report, released by the consulting firm DisplaySearch. These units retail from around 359 yuan (39 euros) while the iPad 2 is sold in Hong Kong for HK$3,888 (346 euros).
"Most of the tablet computer makers in Shenzhen today were previously making copycat cell phones," industry analyst Yang Qun told the China Daily newspaper.
That's bad news for the people at Apple and it's been made even worse thanks to Chinese media reports that claim the company's iPhone 5 -- which reports suggest is due for release next month -- has already been copied.
The "hiPhone" is currently on sale in Shenzhen shops -- and via online stores -- for around 500 yuan (54 euros) and it boasts all the iPhone features -- plus a few more for good measure.
The "hiPhone" has a built-in radio receiver and can accommodate two SIM cards, according to reports.
And while some stores are reporting brisk business -- one online outlet shifted 1,200 of the devices in 30 days China's Ministry of Information and Industry Technology has been quick to issue a warning about the quality of the "hiPhone."
"Most copycat mobile phones have problems, especially higher radiation than the genuine phones which pose serious health risks," a ministry spokesman said. MS