There are plenty of fake iPhone knockoffs, like the HiPhone 4G. Apple has sued many manufacturers around the world for clearly cloning the iPhone or stealing some of its key features.
China has always been the largest hub of fake, knockoff gadgets. If you visit China, chances are you will find all the recent models of mobile phones cloned and selling at less than half their original prices. Because the iPhone's appeal is at a global level, it is becoming increasingly difficult for Apple to crack down on all of these little companies overseas that are creating knockoff iPhone models.
The Sophone is by far the best iPhone 4 knockoff of 2010. It didn't receive American coverage until late December, but the device has been a huge hit in China. It copies the iPhone 4 in almost every way imaginable. The way that the Sophone identically mirrors the iPhone 4 is unbelievable. You really have to see it to believe it...