Current Trends in Wireless Recycling Facilitating Reuse in the Wireless Industry

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Current Trends in Wireless Recycling
Facilitating Reuse in the Wireless Industry

• II FORO AHCIET MOVIL
• Rio de Janeiro, Brasil
• October 5-6, 2004

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Who Is ReCellular?

• Established in 1991
• Headquarters in Dexter, Michigan, USA offices in
  Miami, FL Ft. Worth, TX Sao Paulo, Brazil
  additional facilities around the world.
• Approximately 240 employees worldwide.
• Refurbishing facilities in US, China, Argentina,
  Brazil, Chile, Colombia, and Mexico.
• Generated more than
• 12 million (USD) for charities
• through handset collection
• programs in 2003.

ReCellular Headquarters Dexter, MI, USA
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A Few Strategic Customers
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Strategic Partner

• CTIA Wireless Foundation Board Member.
• Long-term exclusive agreement since 1999.
• Collected more than 100,000 wireless handsets in
  its 1st year.
• Last year CTIA and ReCellular collected nearly
  1.5 million wireless handsets.
• Programs promote charitable and environmental
  causes and provide funding for research studies.

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Strategic Partner

• AHCIET is the largest and most prominent wireless
  industry association in Spain and in Latin
  America.
• Five-year agreement between AHCIET and
  ReCellular to provide recycling and refurbishing
  services to AHCIET members.
• Partnership was created to spread the
  environmental and social benefits of cell phone
  recycling to wireless customers throughout Latin
  America.

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Environmental Trends

• More subscribers more out of service handsets
  accessories
• Collection and recycling of old handsets and
  recycling needs to catch up with pace of retired
  units
• Recycling legislation is signed in California
  coming to your town

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How Many Are There?

• Perhaps 1.2 billion handsets out of service
  worldwide today
• With replacement rates at 12-18 months in many
  areas, perhaps 500 million more handsets per year
  are retiring (with their accessories)
• Users and activations trending up
• Best estimates 1-2 being recycled

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Environmental Threat for the Latin American
Marketplace

• Approximately 150 million subscribers will be
  offered new technology in the next 5 years.
• Technology transitions spurring handset churn
  subscriber growth will cause millions of wireless
  handsets to retire.
• Recycling legislation may soon appear.
• Few initiatives in place today to avoid wireless
  handsets and accessories from entering landfills.
  (Good news even though no current law,
  operators are avoiding landfills)

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Environmental Threat from Discarded Wireless
Handsets

• Wireless handsets contain PBTs-persistent and
  bio-accumulative chemicals.
• Antimony, arsenic, beryllium, cadmium, copper,
  lead, nickel, zinc
• Can cause cancer, reproductive, neurological, and
  development disorders, and can compromise
  childrens immune system if incinerated or put in
  landfills in large quantities.
• Brominated flame retardants which can cause liver
  damage, thyroid dysfunction and endocrine
  disruption if leached into soil from discarding
  in landfills.

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The Good News IsThere is a Solution
Message 1 It can be done. Proper, economical
recycling of wireless scrap is possible today.
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What is ReCellulars Commitment to the
Environment?

• Responsibly recycles 100 of unsaleable wireless
  handsets, batteries and other personal
  electronics.
• Compliant with all occupational and environmental
  regulations.
• Utilizes only U.S. EPA approved recycling
  facilities.
• All electronic waste is properly recycled.
• MRC Michigan 2003 Recycler of the Year.
• NRC 2004 Recycler of the Year, Market Development
• Influencing industry policy and standards. (Basel
  Group, US EPA, Michigan Governors Task Force,
  CTIA)
• Leads industry in environmentally responsible
  behavior.
• No electronic waste goes to municipal landfills.

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Smelting Recovery Processes

• Scrap Handsets
• Recover Silver, Palladium, Gold, Copper
• Ash Captured, Re-Smelted, clean process
• Experiments with plastic chip recovery

• Batteries
• Recover Zinc, Cadmium, Nickel, Halides
• Plastics burned as fuel for process

Accessories (Chargers) Recover Copper
primarily Most other plastics burned as process
fuel Packaging materials are recycled, also
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Recycling Services Offered for Collected Units

• Resale of collected handsets
• Proper recycling of unsaleable units
• Fee-based recycling of scrap, batteries and
  accessories
• UPS battery recycling
• Tower and infrastructure recycling

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Message 2 Collection Programs benefit not
only the environment, but fit well with operator
business objectives.
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Collection Program Types

• Disposal of day-to-day customer service returns
• Sale of surplus, outdated inventory
• Trade-in programs
• Technology transition programs
• Environmental recycling programs
• Charitable collection programs

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Elements of an Effective Wireless Handset
Collection Program
Sorting Grading
Asset Collection
Asset Receipt
Value-Add Services

• Define collection method

• Scan ESN
• Define completeness
• Inventory
• ESN receipt reporting

• Receipt into warehouse
• Unpack

• Refurbishing
• Completion of product
• Repair/Unlock/Reflash

Reporting Reconciliation
Sales Mktg
Pack Ship
Billing Collections

• Open to sales channel
• Web loading
• Email marketing

• Order acceptance
• Complete pack ship
• Invoicing
• Warranty

• Credit Mgmt
• Collections

• ESN receipt reporting
• Revenue program charge rpts
• Tailored as required for program

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Value Generation from Collected Handsets

• Sale of collected units generates cash
• Certain units refurbished returned to operator
  for low-cost reactivation
• These processes cover cost of collection,
  shipping, logistics, and the recycling of scrap
  product
• Corporate responsibility objectives met
• No up-front expenses
• No infrastructure costs

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ReCellulars Program

• Collects wireless assets at the point of sale,
  warehouse, or other corporate locations.
• Offers complete inventory management from receipt
  to sale including identification detailing ESN
  and models received, sorting by condition,
  valuing, and selling.
• Drives retail traffic and offers customer
  retention options.
• Tailors reporting for you to maintain the control
  you need, without the cost associated, down to
  the ESN level.
• Provides an environmentally smart program with
  complete traceability for all recycled handsets.

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Environmental Challenge Becomes Latin American
Operators Opportunity

• Take back or trade-in programs promote growth in
  the market.
• Three Key benefits to Operator and its consumers
• Generates large volume of handsets that can be
  refurbished with the highest quality, lowest
  cost.
• Having a responsible, accountable, convenient
  means of disposing unused wireless handsets,
  batteries and accessories.
• Opportunity to support local or national
  charities and encourage social responsibility.

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Message 3 An AHCIET/ReCellular Collection
Program benefits the environment, fits well with
operator business objectives, and benefits
AHCIET, which does so much good work for our
industry.
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Summary

• Retired equipment is a growing issue
• Potential environmental hazard
• Recycling may soon be regulated
• Recycling solutions exist today
• Collection solutions exist today, endorsed by
  AHCIET and benefiting AHCIET, which help to
  fulfill operator business objectives

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Thank You!

• Gary A. Straus, Manager of Strategic Alliances,
  Latin America
• Heather Robinson, Strategic Account Development,
  Latin America

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Thank you!
ReCellular, Inc. Gary A. Straus VP.
Environmental Compliance and Development 2555
Bishop Circle West Dexter, MI 48130-1563 Phone
800-441-1544 Ext. 222 Direct 734-205-2222 Fax
734-205-2312 Mobile [phone] Email
gstraus_at_recellular.com Web www.recellular.com