SIM-only mobile programmes reduce CO2 emissions

A slowdown of mobile phone upgrade cycles has helped cut CO₂ emissions in half, according to a Green Alliance report, which also reveals customers want to use their phones for longer.

‘The end of the upgrade? How O2 is adapting to a more circular mobile market’, released today (31 May) by the independent think tank, reveals the results of an analysis of phone lifetimes of O2 customers using the company’s O2 Recycle service and SIM-only contracts. The analysis, which was supported by O2, covers four years of use and uses data from eight million customers.

The SIM-only programme provides consumers with a mobile phone service without the need to buy a new phone, meaning new handsets are not bundled in with contracts. As part of its O2 Recycle programme, the company also buys old phones, refurbishes them and prepares them for resale, often in Europe.

According to the report, in general, mobile phone users in the UK are now keeping their phones for 15 per cent longer, on average, than they did in 2012. In addition, SIM-only customers now use their phones for six months longer and produce less than half the yearly emissions as those on two-year contracts.

Current growth model ‘reaching its limits’

The report find that mobile phone upgrade cycles are now significantly longer, partially due to the lack of innovation in the industry over the last five years, meaning phones are taking longer to become functionally obsolete.

It states that the current growth model of the mobile phone industry, based on the sale of new devices, is ‘reaching its limits’, suggesting businesses need to adopt more circular practices.

This is not a new subject for Green Alliance, which has previously published a report highlighting the benefits of on six strategies for the reuse and remanufacturing of ‘smart devices’ including better reuse, software-led longevity and DIY repair.

In that report, released in February 2015, it was found that there are up to 125 million smartphones lying unused in UK homes, despite the value of their components. The parts of a discarded two-year-old iPhone, it claimed, could be worth up to £170 – nearly one third of the original sales value of the device.

Because of the slowed growth of the mobile industry, the resale of mobile phones is estimated to increase four to five times faster than the smartphone market this year, suggesting that a more circular mobile phone market is emerging.

The Green Alliance report revealed:

• 74 per cent of customers on SIM-only contracts have phones older than the UK average of 1.8 years;
• 43 per cent keep their phone for over three years, while one in five use their device for more than four years;
• the average age of a SIM-only device in 2015 was nearly half a year older than in 2012;
• 68 per cent more devices are now being sent to the O2 recycle programme; and
• the majority (72 per cent) of the 420,000 secondhand devices sold through O2 Recycle were sold in Europe, with 40 per cent sold in the UK.

The think tank suggests that, together, these findings show that the mobile phone market is changing, as are consumer preferences, with more customers choosing to keep their existing phones for longer instead of upgrading to new devices.

More sustainable options

According to the report, extending the lifetime of smart devices, which have significant carbon footprints, can significantly reduce CO₂ emissions. By reselling refurbished phones through the O2 Recycle programme the company claims to have saved 10,000 tonnes of CO₂, equivalent to 1.1 per cent of emissions for the UK, and 26 million litres of water since 2012.

O2 has launched several other initiatives designed to reduce waste and extend product lifetimes, such as the ‘Charger out the box’ initiative, where phones are sold without chargers, and the O2 Refresh scheme, which separates payment for device and airtime. In doing so, it aims to reward customers using their phones for longer periods of time with lower bills.

Future steps

Green Alliance believes companies need to make it easier for customers to resell their mobile phones to prevent them ‘ending up in a drawer’ and that schemes to do so should be scaled up as they are ‘technically feasible and economically sensible’.

It suggests that the use of more innovative software, such as trade-in apps to assess the value of older devices, or the use of business models that would allow users access to a second mobile phone in the event of a breakage, would assist customers in selling and using secondhand mobile phones.

Green Alliance also feels the government should encourage circular business models and introduce requirements for mobile phone manufacturers to meet durability and reparability standards.

Many devices become ‘prematurely obsolete’ due to a lack of updateable software or difficulties in replacing batteries or screens. Green Alliance believes that introducing minimum standards for product durability would encourage the use of circular business models and meet customer requirements for longer-lifetime devices.

‘People want their phones to last longer’

Dustin Benton, Head of Energy and Resources at Green Alliance, said: “Data from eight million mobile customers show that people want their phones to last longer. Rather than lament the slowing pace of upgrades, more companies should adapt to these preferences. And governments should help them: we need new rules that make sure phones are built to last, to protect consumers and the environment from the unnecessary costs of premature obsolescence.”

Ronan Dunne, Chief Executive of O2, added: “Sustainability has always been an issue we take seriously at O2, and is a key driver behind our leadership on initiatives from SIM-only and product leasing to O2 Recycle. For me, moving towards a more circular economy isn’t just about doing the right thing. It’s right for our customers and makes good business sense.”

“I’m delighted that Green Alliance’s research using our data has confirmed the value of more circular business models, and would challenge other companies to consider how they might also adopt more sustainable business propositions.”

‘The end of the upgrade? How O2 is adapting to a more circular mobile market’ is available from the Green Alliance website.