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Reduce, Reuse, Profit?
Going green has become a corporate mantra for many enterprises as they increasingly discover that doing so creates a new way to save—or even make—money.

In addition to company initiatives such as decreasing energy use or reducing the amount of carbon emissions, corporations are also looking at how to rid themselves of electronic waste—mobile devices, computers, printers and other electronics. In 2005, between 1.9 million and 2.2 million tons of electronics products were discarded in the United States, with the vast majority dumped in landfills. As little as 346,000 tons were recycled, according to a study by the U.S. Environmental Protection Agency. Disposal by landfill often leads to numerous toxic chemicals leaking into the ground.

“In my 25-plus years of being involved in the recycling industry, I’ve never seen a greater rush from corporations to be green than I’ve seen in the last 12 months,” said Norm England, president and CEO of Rechargeable Battery Recycling Corp. (RBRC), which recycles portable rechargeable batteries and cell phones.

Last month, Sony announced a new initiative called Sony Take Back Recycling Program, which the company is offering at 75 drop-off locations in the operated by Waste Management Recycle America. Dell, Panasonic and others help customers retire their old I.T. assets.

Mobile device e-waste is a compounding problem for many enterprises because of these products’ short life spans. The average mobile phone user gets a new device every 18 months, and many users have more than one device. As such, mobile phones are the largest and fastest-growing segment of the e-waste world.

Bruce Friedman, CEO of Movero—a managed I.T. services provider focused on mobility whose services include helping clients recycle or destroy unwanted devices—describes the box-of-broken-phones phenomenon within many businesses.

“Our sales folks report a common theme. These guys walk into a telecom manager’s office and someone in that proximity has a large box of broken phones on their desk,” Friedman said. “They don’t want to throw them out because they have important information on them, and they feel like they can’t because the devices are an asset of the company.”

But potential cost savings, legislation, good PR and the shareholder demand for corporate responsibility are pushing the enterprise to do something with the box of unwanted phones.

The world’s largest mobile-phone recycler, ReCellular, which expects to reuse or recycle more than 4 million devices in 2007, partners for free with enterprises to institute a collection program in the workplace. About 60 percent of the phones collected are reused and shipped to more than 40 countries around the world. ReCellular then pays the enterprises, and the money can either be donated to charity or used internally for initiatives such as funding the next wave of devices.

RBRC, which has recycled more than 36 million pounds of batteries since the company’s inception 11 years ago and processed 5.6 million pounds in 2006, also partners for free with enterprises and government agencies to set up collection points for rechargeable batteries from mobile phones and other devices such as cordless phones. The non-profit company then ships the batteries to Inmetco, a recycler of metal waste based in Elwood City, , where the nickel is extracted and used in the stainless steel industry. Any profit the RBRC makes from the process is donated to charity, said England.

“Through a program like this, corporations can be philanthropic to organizations and hopefully learn to be environmentally responsible while doing so,” said. “It also saves businesses on the cost of disposal. There are certain regulations for different metals that we deal with.”

Movero primarily recycles devices through a reverse logistics program, Friedman said. The company repairs broken devices or manages the data wipe needed when an employee leaves the company. As such, companies save a significant amount by not having to purchase another phone.

“Often these phones have value so getting it fixed is worth it, versus buying another device, since the second time you buy a device it isn’t subsidized,” Friedman said.

FlipSwap, a fully outsourced cell-phone trade-in solutions provider, is talking with managed mobility service providers such as Movero to implement the company’s online trade-in platform, said Sohrob Farudi, CEO of FlipSwap. The company’s trade-in solution is integrated with a number of retail management system providers such as WorkWireless and TeleTracker, and FlipSwap is looking to replicate the feat in the enterprise.


FlipSwap’s tool enables enterprises to determine via Web-based software a guaranteed trade-in quote for an old mobile phone. The value is issued as instant credit. FlipSwap then reimburses the organization for every phone traded in and then either resells or recycles the units. Corporations, in turn, can receive a rebate check or donate the money to a select charity.

“With our system, companies are empowering their employees to upgrade and giving them the ability to get value out of their existing devices,” Farudi said.

Many states and municipalities are also cracking down on e-waste. , and are among the handful of states that have passed “take-back” laws. made it illegal to throw away nearly all electronic products, while many states require companies to provide an accurate accounting for each phone. Laws are likely to become stricter.

“California is on the leading edge on a lot of environmental policies and many states are adopting similar legislation,” Newman said. “A lot are now moving toward public education, too.”

Perhaps the biggest fear the enterprise has when it comes to shipping away all of those old phones is security. Companies are afraid their devices may turn up on eBay if they aren’t disposed of properly. There are highly publicized incidences of people buying devices off of eBay and discovering the previous owner’s internal company emails, databases and personal account information. Resetting the phone often means sensitive information appears to have been erased but it can be resurrected using specialized yet inexpensive software found on the Internet.

“Enterprises are waking up to the idea that their phones are becoming a unique challenge to deal with,” said ReCellular’s Newman. “I think the first stage was ignoring the fact that the phones were becoming such a common element of a work environment. … Companies haven’t really gotten out in front of understanding that these phones now contain data that can be very business sensitive and that it takes a unique set of skills to handle that information and delete that information effectively and properly.”

Both Movero and ReCellular use specialized software and equipment to wipe clean the data on the devices. There are some 600 different phone models, and a significant number of those have their own software schemes, Newman said.

“It’s very phone-model specific,” Newman said. “Some models have a master reset sequence, but others are very laborious, and you have to go line item by line item to delete the information. We have 10 engineers that write software.”

Despite the promise of effective data wipes, many enterprises still want the majority of their devices destroyed. They simply don’t trust the process.
“We’ve offered to a lot of customers the prospect of having their devices refurbished and given to charities, and they couldn’t do it,” said Friedman. “They couldn’t take the risk.” Farudi said.

FlipSwap has run into the same issues, and education will be key in changing the minds of executives. It certainly doesn’t help that a number of fly-by-night companies have set up shop on the Internet, claiming to give cash for phones. The industry is becoming a lucrative one.
“It’s very easy for someone to throw up a Web site and offer to buy phones,” said Newman. “If the company doesn’t have a phone number and address, that’s a good sign that you might want to look elsewhere.” //