4 Existing Schemes
Telecom
Telecom was the first company in New Zealand to successfully implement a cell phone recycling programme, by engaging a third party to collect handsets from various store drop-off points. This scheme formally began in 2002, and within the first six months 18,700 phones were received. [If we assume that the number of discarded phones in New Zealand is approximately 2.5 million per year, and Telecom provided network coverage for approximately half of these and took back approximately 40,000 phones per year, then this equates to a recovery rate of about 0.4%.] This costs Telecom very little, as the third party (initially Citiraya, but now likely to be MRI or AER) then sorts the handsets into those that are suitable for refurbishment and those that have no further potential for re-use, due to damage or the age of handset leading to incompatibility with current networks in operation.
Currently the collected phones are being stored in Auckland as Telecom is in negotiations with potential recyclers. A decision on which recycler will be contracted - either MRI (based in Australia) or AER (facilities in California and Malaysia but found worldwide) - is expected by the end of the month. MRI is a sorting house for phones only.
Within the next few months, Telecom proposes to launch an expanded cell phone take-back and reuse/recycle scheme. Telecom is currently developing an expanded educational programme (to encourage phone return), finalising audits of recycling partners and estimating the potential numbers of phones to be recycled.
The proposed scheme is to be added to the existing Telegistics programme, set up recently by Telecom to better manage phone repairs. The collected phones will be earmarked for either recycling or refurbishment. Phones coming in for repair will (depending on repair costs to the consumer compared to a new phone purchase) be either repaired and returned to the consumer or forwarded on to the recycling and refurbishment schemes. Handsets that are earmarked for refurbishment will be sold into developing countries across the Pacific Island region to enable lower income communities to have access to mobile technology.
Vodafone
Vodafone encourages customers to dispose of handsets and accessories in a safe and responsible way, by 1) advertising their return programmes, 2) providing incentives to customers and 3) making it easy for customers to return unwanted phones through pre-paid envelopes or prominent recycling points in retail outlets.
In response to concerns about the number of phones being returned (primarily due to lack of customer awareness of this as an option and the resistance to discarding phones discussed earlier in this report), from September 2003 to September 2004 Vodafone undertook a phone return campaign entitled "The Good, the Bad and the Ugly". Under this scheme, for every person who returned their mobile phone for recycling, the Vodafone New Zealand Foundation donated $5 to the Zero Waste New Zealand Trust. In the year to 31 March 2005, customers returned a total of just over 40,000 mobile phones to Vodafone, [Vodafone New Zealand.Corporate Responsibility Report 2004-2005.] producing a similar cell phone recovery rate to that of Telecom. Although the scheme was successful, significant awareness and promotion support was required to maintain the scheme profile. Also, there was some abuse as customers returned different components of phones (battery, handset, charger) separately and argued for the $5 fee for each of these. Vodafone made a decision to taper off support for this programme and focus on a new improved programme to be launched in April or May 2006.
Vodafone's future plans to encourage greater tack-back of phones through 2006 and 2007 are three-fold:
- to operate proactive recycling programmes at government, corporate and community level, on request and at no cost to the customer;
- to actively offer consumers and small business a trade-in incentive for old phones when upgrading to a new one;
- to provide a freepost address for customers to send unwanted phones, chargers and accessories back to Vodafone at no cost to the customer.
Vodafone are currently finalising the launch of a major phone recycling initiative for 2006-2007. Details of the scheme are not currently in the public domain.
Based on discussions with Vodafone during this project, the proposed scheme will be implemented in partnership with Recycle New Zealand (an operating division of Waste Management). The new scheme will separately target larger account customers (corporate and government departments) and individual pre-pay customers. Tailor-made literature is being developed to educate staff within the corporate and government departments. There will be trade-in promotion for small businesses. Special bins are to be supplied by Recycle New Zealand on calendar rotation to "low hanging" collection points, i.e. larger public and private sector customers. Vodafone has a target of recovering 50,000 cell phones for the 2006 financial year is 50,000.
Vodafone is currently working on a sales contract with customers to sign, and therefore commit, to "best endeavours" to bring phones back.
The collected phones will be shipped to Shields UK for recycling or refurbishment. Vodafone have arranged a contract with Shields to pay for the phone collection up to the point that they are loaded onto ship. Shields UK will then pay for all transport, recycling and refurbishment costs.
Vodafone have agreed on minimum of zero return and possible dividend from Shields, depending on profit margin for recycled components and refurbished phones. However, Vodafone is not currently able to receive a refund due to regulatory issues (see discussion in Section 4: Secondhand Dealers and Pawnbrokers Act). Shields UK are confident they can return a profit, despite much greater transport costs than for UK or European phones.
Vodafone are also offering fixed-line substitution, to encourage completely mobile telecommunications for firms, and are comfortable with the concept of collecting used, fixed-line phones. The business case for this approach is primarily customer service and brand management, i.e. increasing "touchpoints" with the customer.
This approach is aligned with the corporate social responsibility commitments of Vodafone.
Local council initiatives
In 2004, Vodafone was involved in a joint phone take-back scheme with the Auckland Regional Council (ARC) using the council's hazardous waste collection programme - Hazmobile. Approximately 400 phones were collected. Discussions are currently under way between Vodafone and ARC, to extend the service to other parts of Auckland.
A phone recovery scheme has been trialled by SmartManukau, a division of Manukau City Council. A recycling box was located at the Council's Citizen and Customer Centre at Kotuku House. The returned phones were being shipped to Singapore and the components broken down for reuse instead of sending them to landfill. We understand that this initiative is no longer operational.
