How circular business models can tackle electronic waste

Electronic waste is a growing global concern, with Statista estimating that it will increase from 53.6 million metric tons in 2019 to 75 million metric tons by 2030. Manufacturing new devices requires the extraction and processing of raw materials, which is energy-intensive, environmentally damaging and generates the most CO2 emissions.

Last year, more than 1.3 billion smartphones were sold and although the Swedish Environmental Research Institute (IVL) has concluded that manufacturing a new smartphone generates, on average, 86 kilograms of waste, each phone’s life expectancy is just 2.7 years. At the same time, the IVL study shows that if a smartphone is reused, rather than buying a new device, this avoids an average of 55 kilograms of CO2 emissions. In addition, a PwC study published last month shows that proactive adoption of the product-as-a-service business model for consumer electronics could lead to a cost savings of at least ~27% and a CO2-equivalent reduction of at least ~36% by 2035 compared to a business-as-usual model, using 2023 as a baseline. By extending the lifetime of devices through refurbishment and Device as a Service programs, Telia Company aims to reduce the CO2 emissions associated with new devices, the amount of waste generated across the supply chain and electronic waste in general.

Refurbished phones

Within Telia’s footprint, refurbished mobile phones are most popular in Norway and a year ago the company passed a significant milestone by selling its 100,000th refurbished phone in the country. The story began in 2016, when Telia Norway – then operating under the NetCom brand – launched a buyback program. Customers were encouraged to trade in their used phones in return for a voucher that they could use to buy a new phone.

The program, which is still running, enabled Telia Norway to accumulate a large amount of good quality pre-owned phones. Telia began selling these phones via its OneCall value brand in 2018 and they proved so popular that the concept was extended to the main Telia brand in 2020 and to Telia’s B2B fighter brand, Phonero, in January 2023.

Before selling a used phone, Telia Norway thoroughly inspects and tests it to ensure it meets the company’s standards for functionality and appearance. Refurbished phones come with a two-year warranty and a five-year right of complaint.

Today, almost 15% of phones sold by Telia in Norway are pre-owned, which Pål Rune Kaalen, who is head of consumer business at Telia Norway, attributes in part to strategic use of public relations. Telia Norway proactively reports its top-10 most popular pre-owned phones each quarter – so far, the list is dominated by various versions of Apple’s iPhone – and actively shares milestones and its experience of selling pre-owned phones at industry events.

“Telia’s OneCall brand now sells as many used phones as it does new ones and – given the increased focus on sustainability and costs – we expect sales to increase further in the future,” says Kaalen. “Used phones are good for both the environment and our wallets, and we are working in parallel to expand our range to include tablets and smartwatches, for example.”

Following the same playbook it used for pre-owned phones, Telia Norway began selling used tablets under its OneCall brand in October and sold almost 500 of them in the first month. Looking ahead, Telia Norway aims to increase its supply of used devices to better control fluctuations and is engaging with the Norwegian government in an attempt to make regulations on the sale of pre-owned phones – which aim to prevent the sale of stolen devices – less burdensome.

Device as a Service

In Sweden, one in three Telia business customers choose the Device as a Service model, a leasing model marketed as “Mobile as a Service”. With this model, Telia maintains ownership of the phones it provides to its customers’ employees, which increases Telia’s ability to extend the lifetime of these devices. This is a simple and cost-effective solution that includes display protectors and phone cases and provisions for repair and refurbishment of devices, thereby extending their life spans and reducing the need to purchase new devices. This approach also creates jobs in the repair and refurbishment industry. When devices are returned to Telia, the company ensures they are securely wiped of all data and either refurbished for sale as pre-owned devices or recycled in an environmentally safe manner, rather than simply being thrown away or kept in a drawer for years.

Capgemini Sweden chose Mobile as a Service Plus, which enabled the company to offer its employees the latest mobile phones at a fixed monthly cost. Telia takes care of everything from purchasing and start-up to service, repairs and replacements, and insurance is also included. Capgemini employees can choose from a predefined range of smartphones in a web shop that Telia manages and maintains for the company.

While acknowledging the importance of always being connected, Björn Sjögerås, Chief Operating Officer for Capgemini in Scandinavia, notes that many of his employees are increasingly aware of sustainability issues, which made “Mobile as a Service” a good fit.

“In addition to making it easier to manage mobile phones, for both the company and the staff, we have also consciously designed the solution to make the technology last longer, and thus reduce the need to replace devices,” Sjögerås says. “All phones come with screen protectors and covers. And after two years you can choose to keep your smartphone, provided that you continue to use it for business for a certain period. In this way, we create the conditions and incentives for a circular mindset, reducing the waste of resources.”

Capgemini went a step further by adding phones produced by Fairphone – a Dutch company that aims to create more sustainable smartphones – to its range of employee devices.

“A colleague contacted me a while ago and he was actually upset that he could replace his mobile phone after two years,” Sjögerås says. “He thought it was a waste. More and more people have this attitude. The throwaway society is not sustainable. I think we are taking important steps in the right direction, and we will continue this work.”

By extending the life span of devices, Telia’s refurbishment and Device as a Service programs reduce the need to extract and process raw materials to produce new ones. This approach conserves precious resources and reduces the environmental impact of raw material extraction and device manufacturing. Last year, pre-owned mobile phones accounted for 3% of Telia’s total B2C mobile phone sales, while Device as a Service accounted for 27% of the company’s total B2B mobile phone sales.