Industrial spying on the rise

In August, workers at Samsung Electronics in the South Korean city of Suwon swathed 60 next-generation televisions in bubble wrap and nailed them into wooden crates. Two weeks later, when the boxes were opened at a Berlin trade show, two televisions were missing.

The 55-inch prototypes - each costing US$10,000 and weighing about 19.5kg - featured breakthrough technology known as organic light-emitting diode displays (OLED), which make televisions thinner and help project brighter and sharper images. The suspects: corporate spies.

Thefts of televisions, diagrams and circuitry are on the rise, and that is bad news for Samsung and LG Electronics - the only firms that can commercially produce OLED displays, which the US$110 billion flat-screen television industry expects to wow consumers and revive slumping sales. South Korea's National Industrial Security Centre, part of the country's intelligence agency, last year reported 46 cases involving attempts to steal local firms' secrets overseas, up from 32 in 2007.

While estimates of industrial espionage are hard to come by, Korea says foreign theft of its corporate secrets resulted in about US$82 billion in damages in 2008, up from US$26 billion in 2004.

The Koreans say 60 per cent of victims are small and medium-sized businesses, and half of all economic espionage originates in China, according to a 2011 US congressional report. "Any company that has a competitive advantage or new technology will be targeted by industrial espionage," says Frank Schurgers, managing director of security agency Integris International in Berlin.

German companies lose an estimated US$28 billion to US$71 billion annually - and as many as 70,000 jobs - due to foreign economic espionage, regulators say.