Theft of hard drives and other computer equipment is on the increase, with several distributors and vendors reporting major break-ins and lost deliveries in the past three months.
Maxtor director Philip Adams says the problem escalated about three months ago, with break-ins to vendors and suppliers and deliveries arriving with some components missing. More recently, a 420kg palette load of 640 Maxtor 1.6Gb hard disk drives valued at $150,000 failed to arrive at a customer location. "It really is an epidemic in this industry at the moment, and it's not heard of in the general market, but it's known of behind the scenes. And it's all just seemed to have happened within the last three months."
Adams says as many as seven of both his and other vendors' customers have been hit. He said situations have included as many as 80 drives going missing at once on a delivery. In most cases the missing drives cannot be tracked down and are written off. All of them have lost at least 100 drives all up over the last two-and-a-half to three months in the freight section of the transaction, for reasons they cannot account for.
While no one is quite sure where the stolen drives are turning up, one industry source suggested they are being fed back into the channel through resellers who are more interested in price than legitimacy.
Adams says he has isolated the serial numbers of all missing and stolen Maxtor drives, and has received numerous phone calls from people asking if specific drives are under warranty. Adams says that, invariably, when he comes across the serial number of the stolen drive the caller will hang up once he asks further questions.
On the edge
Edge technology's vice-president Peter Lai says his company's Sydney operation has been broken into at least six times since November 1995. In a single break-in in October thieves punched a hole through a solid wall and stole $300,000 of hard drives and notebooks.
Edge's Queensland operation has also been burgled, with thieves entering through the roof. Lai says similar tales have also been told by Edge's dealers, where boxes worth a few thousand dollars go missing.
Westan has also been a victim of burglars, with $100,000 of notebook computers and hard drives taken. Francis Tan suspects there is a large organised group operating between States, as most product stolen in one State tends to surface in another. "I think there must be a group of people who know exactly what they want, and they come into our store and just take the expensive items. There were things like keyboards and chip products that they didn't even touch."
Tan says that after the first break-in Westan installed a high-pitch alarm and a metal cage to hold its more expensive components. When thieves broke in a second time and couldn't gain access to the cage they left empty handed, even though keyboards and other components could have been taken. "We really don't know what to do, because the only thing we can do right now is to upgrade our security system. I think the high-pitch sound works - the second time they broke in they didn't know about it. But what if the third time they cover their ears?" Prior to these incidents Tan says Westan had not been the victim of break-ins.
Adams says an unfortunate side effect is increased insurance premiums. "Insurance, security and other costs that wouldn't have been thought about six months ago are now beginning to play a significant part in the considerations for people handling these products."