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Circular Business Models in the Mobile Phone Industry Nordic Council of Ministers the Mobile Business Models in Phone Industry 2017:560 Circular TemaNord Nordens Hus Ved Stranden 18 DK-1061 Copenhagen K www.norden.org Circular Business Models in the Mobile Phone Industry The circular economy offer opportunities to reduce resource use and waste whilst providing business opportunities. This is also true in the mobile phone industry that has been characterised by high rates of product obsolescence. The emergence of the smart phone has changed the landscape, making repair, refurbishment and resell attractive to businesses and consumers. Moreover, emerging modular phone design should allow functional upgrades with low resource wastage. This report investigates the adoption of circular business models within Nordic markets. Producers, retailers, refurbishers, recyclers and resellers tell of their motivation, experiences and the challenges that they face. A special look is taken at consumer and waste law and the challenges and opportunities they represent. The report ends with 17 policy proposals that can accelerate the adoption of circularity in the sector. Circular Business Models in the Mobile Phone Industry Circular Business Models in the Mobile Phone Industry David Watson, Anja Charlotte Gylling, Naoko Tojo, Harald Throne-Holst, Bjørn Bauer and Leonidas Milios TemaNord 2017:560 Circular Business Models in the Mobile Phone Industry David Watson, Anja Charlotte Gylling, Naoko Tojo, Harald Throne-Holst , Bjørn Bauer and Leonidas Milios ISBN 978-92-893-5202-4 (PRINT) ISBN 978-92-893-5203-1 (PDF) ISBN 978-92-893-5204-8 (EPUB) http://dx.doi.org/10.6027/TN2017-560 TemaNord 2017:560 ISSN 0908-6692 Standard: PDF/UA-1 ISO 14289-1 © Nordic Council of Ministers 2017 Cover photo: Scanpix Print: Rosendahls Printed in Denmark Disclaimer This publication was funded by the Nordic Council of Ministers. However, the content does not necessarily reflect the Nordic Council of Ministers’ views, opinions, attitudes or recommendations. Rights and permissions This work is made available under the Creative Commons Attribution 4.0 International license (CC BY 4.0) https://creativecommons.org/licenses/by/4.0. Translations: If you translate this work, please include the following disclaimer: This translation was not pro- duced by the Nordic Council of Ministers and should not be construed as official. The Nordic Council of Ministers cannot be held responsible for the translation or any errors in it. Adaptations: If you adapt this work, please include the following disclaimer along with the attribution: This is an adaptation of an original work by the Nordic Council of Ministers. Responsibility for the views and opinions expressed in the adaptation rests solely with its author(s). The views and opinions in this adaptation have not been approved by the Nordic Council of Ministers. Third-party content: The Nordic Council of Ministers does not necessarily own every single part of this work. The Nordic Council of Ministers cannot, therefore, guarantee that the reuse of third-party content does not in- fringe the copyright of the third party. If you wish to reuse any third-party content, you bear the risks associ- ated with any such rights violations. You are responsible for determining whether there is a need to obtain per- mission for the use of third-party content, and if so, for obtaining the relevant permission from the copyright holder. Examples of third-party content may include, but are not limited to, tables, figures or images. Photo rights (further permission required for reuse) Any queries regarding rights and licences should be addressed to: Nordic Council of Ministers/Publication Unit Ved Stranden 18 DK-1061 Copenhagen K Denmark Phone +45 3396 0200 [email protected] Nordic co-operation Nordic co-operation is one of the world’s most extensive forms of regional collaboration, involving Denmark, Finland, Iceland, Norway, Sweden, and the Faroe Islands, Greenland and Åland. Nordic co-operation has firm traditions in politics, economics and culture and plays an important role in European and international forums. The Nordic community strives for a strong Nordic Region in a strong Europe. Nordic co-operation promotes regional interests and values in a global world. The values shared by the Nordic countries help make the region one of the most innovative and competitive in the world. The Nordic Council of Ministers Nordens Hus Ved Stranden 18 DK-1061 Copenhagen K, Denmark Tel.: +45 3396 0200 www.norden.org Download Nordic publications at www.norden.org/nordpub Contents List of figures .............................................................................................................................7 Summary ................................................................................................................................. 9 Preface .................................................................................................................................... 17 1. Background and Objectives .............................................................................................. 19 1.1 Background ........................................................................................................... 19 1.2 Project objectives and outputs ................................................................................21 1.3 Structure of the project and this report ...................................................................21 2. Mapping out green business models ..................................................................................23 2.1 Approach ................................................................................................................23 2.2 Broad Trends in Mobile Phones and Services .......................................................... 24 2.3 Experiences with green business models ................................................................ 29 3. Consumer Law and other Regulations ................................................................................ 51 3.1 Approach ................................................................................................................ 51 3.2 Consumer Law, Guarantees and Warranties ............................................................ 51 3.3 Definition and ownership of waste ......................................................................... 63 3.4 Other relevant regulations/policy ........................................................................... 68 4. Conclusions and recommendations .................................................................................. 69 4.1 Summary of findings .............................................................................................. 69 4.2 Potential Measures for Promoting Green Business Models ...................................... 76 References .............................................................................................................................. 79 Sammenfatning ..................................................................................................................... 83 Annex: List of participants at Helsinki workshop ...................................................................... 87 List of figures Figure 1: Reasons (according to businesses) for smartphone replacement ............................... 19 Figure 2: Interviews broken down by actor group and country ................................................. 24 Figure 3: Smart phone and feature phone (more simple phones) penetration of the market in the UK .............................................................................................................................. 25 Figure 4: Numbers of interviewed businesses that reported selected changing conditions ....... 26 Figure 5: Green business models .............................................................................................. 31 Figure 6: Reported engagement in “greener” approaches in response, or otherwise, to changing conditions......................................................................................................................... 34 Figure 7: Reported motivation for engaging in greener activities .............................................. 35 Figure 8: Reported intragroup co-operations .......................................................................... 42 Figure 9: Relationships between actors in the value chain ....................................................... 42 Figure 10: What motivates consumers to get their phones repaired or buy second hand (according to businesses) .................................................................................................. 44 Figure 11: The factors that are most important to consumers when choosing repair services and second-hand phones (according to businesses) ................................................................. 44 Figure 12: Reported obstacles to greener initiatives ................................................................ 45 Figure 13: A day in the life of a smart phone ............................................................................ 59 Summary Project objectives The project objectives were to map out the extent to which more circular business models are being adopted in the mobile phone and service industry, and identify how this adoption can be accelerated. The focus was on models that extend the active lifetimes of phones and their components. The following models/activities are considered relevant: Design
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