CCTV investigation reveals illegal motherboard production in China · TechNode

On March 15, the annual 315 Evening consumer rights TV broadcast co-hosted by state media China Central Television (CCTV) and a number of national government departments, exposed an illegal industrial chain producing motherboards for the mass manipulation of smartphones. In the undercover journalists’ secretly recorded footage, manufacturers boast that their motherboards can be used to assemble multiple smartphone mainboards, allowing one person to control multiple phones to perform identical operations on one computer. These motherboards are touted as being able to participate in and control all the network functions of the connected smartphones via the computer.

Why it matters: CCTV’s 315 show has been broadcast since 1991 and has regularly created headlines with its high profile investigations into companies undermining consumer rights. This latest scandal could have implications for China’s e-commerce, gaming, and social media sectors.

Details: According to CCTV’s exposé, specialized motherboard manufacturers assemble dozens of smartphone mainboards to integrate them into a single motherboard that can be controlled by connecting it to a computer, enabling a single user to control multiple devices, each with its own IP (Internet Protocol) address.

• “You can become a king of controlling everything in the online world,” a company executive told an undercover journalist at one point during the broadcast. Buyers can manipulate various IP addresses for purposes such as placing fake orders, posting fake comments or likes, and manipulating online voting through a large number of motherboard devices. 
• Undercover journalists discovered that clients using motherboard devices engage in various online activities, such as promoting advertisements, gaming and e-commerce related behavior, faking active interactions from different users in livestreaming rooms, and boosting traffic for certain public relations articles.
• The report also mentioned a company planning to build a facility with tens of thousands or more motherboards, which would equate to having hundreds of thousands of fake IP addresses.
• The price of the motherboard devices ranges from RMB 3,000 ($417) to RMB 6,000 ($834), with each set containing 20 smartphone mainboards. In the secretly recorded footage shown on CCTV, an employee of a motherboard manufacturer even invited the undercover journalist to experience the powerful device on-site.
• The customized version of the motherboard violates article 12 of the Anti-Unfair Competition Law of China, which states: “Business operators shall not use technical means to hinder or disrupt the normal operation of network products or services provided by other operators through influencing user choices.”
• The CCTV report mentioned three companies: Yunji Xia Technology, Shenzhen Yuncheng Future Technology, and Hunan Yundou Technology. The data agency Tianyancha indicates that 320 companies are currently engaged in motherboard production in China, according to a report by local media outlet Jiemian. In terms of regional distribution, Guangdong, Jiangsu, and Jiangxi have the highest concentration of companies related to motherboard business, with 230, 14, and 12 companies respectively.

Context: The 315 Evening this year also exposed a range of other illegal activities and disreputable business practices, including fire-resistant glass that isn’t fireproof, fire extinguishers that cannot put out fires, tainted preserved pork, deceptive practices on matchmaking platforms, unsettling sounds from BMW transmission shafts, and the installment of loan lending platform scams via gift cards. 

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