Handset Recycling and Refurbishment

Impact on Primary Handset Sales and Opportunities for Mobile Operators, Handset Vendors, Recycling Companies, and Retailers

In 2007, over 60% of all handsets sold worldwide are likely to be replacements. These high handset replacement sales also mean that large numbers of old handsets are lying around with users. They can be recycled for reuse. In addition, there are also handsets that customers return to operators and retailers within the accepted 14-day or 1-month period, for refund or a new replacement. These devices are generating a growing market for recycled and refurbished handsets. Using second-hand units, operators are able to start generating profits on low margin accounts much more quickly rather than having to wait to recover subsidies on new handsets.

This study focuses on the growing market for recycled and refurbished handsets and the opportunities and challenges it offers for handset vendors, mobile operators, recycling companies, and retailers.

What Questions Does This Report Answer?

  • What are the key drivers, barriers, and latest trends influencing the market for recycled and refurbished handsets?
  • What are the high-level business and marketing issues, and critical considerations for addressing the market for recycled and refurbished handsets?
  • How big is the market for recycled and refurbished handsets?
  • Who are the key industry players and with what initiatives do they address the market for handset recycling and refurbishment?
  • What market opportunities exist for mobile operators, handset vendors, recycling companies and retailers.
  • Why should handset vendors consider the demand for recycled and refurbished handsets as an opportunity and not a threat?
  • What impact can recycled and refurbished handsets have on mobile operators’ subscriber acquisition costs?
  • Where are the key markets for recycled and refurbished handsets and opportunities in developed and emerging markets?
  • What processes are involved wit recycling, refurbishment and ethical disposal of handsets?
  • What impact do legislation and environmental concerns have on the recycling, refurbishment and ethical disposal of handsets?
  • What initiatives have vendors undertaken in the design and manufacturing of handsets?
  • What is the impact of recycled and refurbished handsets on the primary mobile phone market?
  • The second-hand mobile phone market?
  • What are handsets return channels, and what are the benefits and drawbacks of outsourcing?

Who Needs This Report?

  • Handset vendors
  • Mobile operators and MVNOs
  • Handset recycling companies
  • ODMS and OEMS
  • Trade associations
  • Distributors and retailers of mobile handsets and accessories
  • Financial institutions involved with mobile communications
  • Venture capitalists and other investors

Table of Contents


Section 1.
EXECUTIVE SUMMARY
1.1. Market Drivers and Barriers
1.2. High Level Business and Marketing Issues
1.3. Key Market Forecasts

Section 2.
KEY TAKEAWAYS AND STRATEGIC RECOMMENDATIONS
2.1. Key Takeaways and Recommendations for Mobile Operators
2.2. Key Takeaways and Recommendations for Handset Vendors
2.3. Key Takeaways and Recommendations for Handset Recycling Companies

Section 3.
STRATEGIC OVERVIEW
3.1. Industry Value Chain for Handset Recycling, Refurbishment and Ethical Disposal
3.1.1. Mobile Operators
3.1.2. Handset Manufacturers
3.1.3. Recycling Companies
3.1.4. Regulators
3.1.5. Charities, Associations and Initiatives
3.2. The Need for Handset Recycling, Refurbishment and Ethical Disposal
3.2.1. Growing Market Saturation & Replacement Handset Sales
3.2.2. Increasing Number of Unused Handsets
3.2.3. Controlling Subscriber Acquisition Costs
3.2.4. Protecting the Environment
3.2.5. Addressing Low Income Consumers in Developing Markets
3.3. Handset Recycling, Refurbishment & Ethical Disposal Process
3.3.1. Handset Recycling
3.3.1.1. Steps Involved in Handset Recycling
3.3.1.1.1. Handset Collection
3.3.1.1.2. Handset Testing
3.3.1.1.3. Recycling Process
3.3.1.1.4. Handset Re-distribution
3.3.2. Handset Refurbishment
3.3.2.1. Steps Involved in Handset Refurbishment
3.3.2.1.1. Handset Collection
3.3.2.1.2. Refurbishment Process
3.3.2.1.3. Handset Re-distribution
3.3.3. Handset Ethical Disposal
3.3.3.1. Steps Involved in Handset Ethical Disposal
3.3.3.1.1. Handset Collection
3.3.3.1.2. Mechanical Dismantling
3.3.3.1.3. Incineration Process & Recovering of Metals
3.3.3.1.4. Ethical Disposal of Non-recoverable Parts

Section 4.
MARKET FACTORS
4.1. Drivers for Handset Recycling, Refurbishment and Ethical Disposal
4.1.1. Regulatory Necessity
4.1.1.1. RoHS (Restriction of Hazardous Substances)
4.1.1.2. WEEE (Waste Electrical and Electronic Equipment)
4.1.1.3. IPP (Integrated Product Policy)
4.1.2. Shorter Handset Replacement Periods
4.1.3. Growing Demand of Low Cost Handsets in Emerging Markets
4.1.4. Addressing Prepaid Handset Users
4.1.5. MVNOs (Mobile Virtual Network Operators)
4.1.6. Availability of Highly Subsidized Handsets for Customers
4.1.7. Improvements in Handset Design & Manufacturing
4.2. Barriers to Handset Recycling, Refurbishment and Ethical Disposal
4.2.1. Lack of Consumer Education
4.2.2. Low handset Returns
4.2.3. Quick Decline of ASP and Low Margins
4.2.4. Potential Loss for Handset Vendors
4.3. Impact on the Handset Market
4.3.1. Handset Manufacturing Process
4.3.1.1. Closed Loop Production Systems
4.3.1.2. Eco-Friendly Designing & Manufacturing of Handsets
4.3.1.3. Reducing Handset Energy Consumption
4.3.2. Impact on the Primary Handset Market
4.3.3. Impact on the Second-hand Mobile Phone Market
4.3.4. Regional Differences

Section 5.
CRITICAL BUSINESS ISSUES
5.1. Providing Incentives to Customers to Encourage Handset Returns
5.2. Handset Reverse Supply Chain Management
5.2.1. Importance & Challenges to Handset Reverse Supply Chain Management
5.2.2. Restructuring of Reverse Supply Chain Management
5.2.2.1. Avoiding “One Size Fits All” Approach
5.2.2.2. Competitive Advantage through Efficient Reverse Supply Management
5.2.2.3. Preventing New Handset Returns
5.2.2.4. Managing Shipping Costs
5.2.2.5. Incorporate Handset Returns into the overall SIOP Process
5.2.2.6. Automation of Handset Return and Repair Operations
5.3. Managing Handset Return Channels
5.3.1. Owned Stores
5.3.2. Dealer/Agent
5.3.3. Direct-Ship Returns
5.3.4. Centralized Metro-Area Return Depots
5.4. Outsourcing

Section 6.
KEY INDUSTRY PLAYERS
6.1. Nokia
6.2. Motorola
6.3. Sony Ericsson
6.4. Vodafone
6.5. O2
6.6. Orange/France Telecom
6.7. Sprint Nextel
6.8. ReCellular
6.9. Fonebak
6.10. Eazyfone
6.11. CTIA
6.12. GSM Association

Section 7.
MARKET FORECASTS
7.1. Forecast Methodology
7.1.1. Analyzing Global Handset Shipments Trends by Region and Handset Type
7.1.2. Analyzing Global Mobile Subscriber Trends and Net Additions by different Regions
7.1.3. The New Product Diffusion Model
7.1.4. Deriving the Growth Coefficients
7.1.5. The New Product Conundrum
7.1.6. Using Analogical Products as a Base Line
7.2. Key Forecast Assumptions
7.3. Handsets Returned by Users for Recycling & Ethical Disposal
7.4. Recycled Handset Shipments by Region, 2005-2012
7.5. Recycled Handset Revenues by Region, 2005-2012
7.6. Ethical Disposal of Handsets by Region, 2005-2012
7.7. Revenue from Ethical Disposal of Handsets by Region, 2005-2012
7.8. Refurbished Handset Shipments by Region, 2005-2012
7.9. Refurbished Handsets Revenue by Region
7.10. Key Markets for Recycled and Refurbished Handsets
7.10.1. USA, Mexico and Canada
7.10.2. China and Hong Kong
7.10.3. India, Pakistan and Bangladesh
7.10.4. Romania, Ukraine and Czech Republic
7.10.5. South Africa, Ghana, Congo and Kenya
7.10.6. Argentina, Brazil, Chile and Colombia
7.11. Forecast Conclusions

Section 8.
COMPANY LIST

Section 9.
ACRONYMS
SCOPE OF STUDY
SOURCES AND METHODOLOGY
NOTES



Tables
  • Total Handsets for Recycling, Refurbishment & Ethical Disposal, World Market, Forecast: 2005 to 2012
  • Total Revenue from Handsets for Recycling, Refurbishment & Ethical Disposal, World Market, Forecast: 2005 to 2012
  • Popular Low Cost Handsets in Emerging Markets, 2005-2006
  • Amount Customers can get for Returning Used Handsets to Eazyfone, September 30, 2006
  • Advantages and Disadvantages of Outsourcing, Handset Return & Repair Functions
  • Handset Shipments by Region, World Market, Forecast: 2005 to 2012
  • Net Subscriber Additions by Region, World Market, Forecast: 2005 to 2012
  • Replacement Handset Sales by Region, World Market, Forecast: 2005 to 2012
  • Handsets Returned by Users for Recycling & Ethical Disposal, By Region & Total, Forecast: 2005 to 2012
  • Refurbished Handset Revenue by Region, By Region & Total, Forecast: 2005 to 2012
  • Recycled & Refurbished Handsets Shipments & Revenue, World Market, Forecast: 2005 to 2012
  • Ethical Disposal of Handsets by Region, World Market, Forecast: 2005 to 2012
  • Revenue from Ethical Disposal of Handsets by Region, World Market, Forecast: 2005 to 2012
  • Handsets Returned by Users for Refurbishment, World Market, Forecast: 2005 to 2012
  • Refurbished Handset Shipments by Region, World Market, Forecast: 2005 to 2012
  • Re-cycled Handset Shipments by Region, World Market, Forecast: 2005 to 2012
  • Re-cycled Handset Revenue by Region, USA, Mexico, Canada, Forecast: 2005 to 2012
  • Ethical Disposal of Handsets by Region, China, Hong Kong, Forecast: 2005 to 2012
  • Revenue from Ethical Disposal of Handsets by Region, India, Pakistan, Bangladesh, Forecast: 2005 to 2012
  • Handsets Returned by Users for Refurbishment, Romania, Ukraine, Czech Republic, Forecast: 2005 to 2012
  • Refurbished Handset Shipments by Region, Nigeria, South Africa, Ghana, Kenya, Forecast: 2005 to 2012
  • Refurbished Handset Revenue by Region, Argentina, Brazil, Chile, Colombia, Forecast: 2005 to 2012
  • Mobile Subscribers by Region, World Market, Forecast: 2005 to 2012
  • Amount of Material Recycled during Handset Disposal, World Market, Forecast: 2005 to 2012

Charts
  • Used Handsets Collected by O2, Orange & Vodafone, 2006
  • Used Handsets Collected by ReCellular & Fonebak, 2004 to 2006
  • Mobile Subscriber Penetration by Region, 2006
  • What Most People do with their Old Handsets, Compiled from Various Surveys Done in the Period 2004-2006
  • Composition of a Mobile Phone, 2008
  • Handsets Returned by Users for Recycling & Ethical Disposal, By Region: 2006
  • Mobile Subscribers by Region, World Market, Forecast: 2005 to 2012
  • Mass of Material Recycled During Handset Disposal, World Market, Forecast: 2005 to 2012

Figures
  • Key Players Addressing the Market for Handset Recycling, Refurbishment & Ethical Disposal
  • What Happens to Most Old Unused Handsets
  • WEEE Directive "Crossed Out Wheeled Bin Symbol"
  • Product Diffusion Model
  • New Product Diffusion Profile (Net Adoptions)