industry presentations

International Wireless Communications Recycling Association (IWCRA)

A Committee of the International Association of Electronics Recyclers

Presents

“The Recycling of Wireless Devices”

May 10, 2006 – San Francisco, CA

2006 - 1.6 billion cell phone subscribers worldwide. 200 million subscribers in U.S.

2010 – Projected 2.0 billion cell phone subscribers worldwide.

2006 – 915 million handset will be sold. Annual growth rate 10-15%

Wireless Recycling – Key Drivers

• Average users changes handset every 14-18 months• In U.S. approximately 80% of handset sales are replacements.• Multiple technologies create more waste• Cell Phones are small and easily disposable• More camera phones sold than digital cameras.


• Retired Handsets in U.S. – estimated between 100 million and 400 million.

• Self-Sustaining Economic Model (very different than CPU/Monitor/Television)

• High Re-use rate (60-65%)


IWCRA Session Agenda

1. The Economics of Wireless Recycling Craig Boswell, VP Operations, Hobi International, Inc.,

2. Collection Method – NonprofitsMarc M. Leff, Founder & Chief Operating Officer, GRC Wireless Recycling, Miramar, FL


3. Collection Method – Carrier/Retail/Manufacturer Jenifer Chambers, Director, Recellular, Dexter, Michigan

4. Collection Method – ConsumerJames Mosieur, President, RMS Communications, Ocala, FL.


5. Processing Jenifer Chambers, ReCellular, Dexter, Michigan

6. Regulatory IssuesBob Tonetti, Office of Solid Waste, EPA

Craig BoswellVice President of Operations

Hobi International, Inc.

The Economics of Wireless Recycling

Outline

Cellphone Recycling Overview Recovery Logistics Economics and Reuse

Cell Phone Recycling

Basics of cellphone recycling are the same as all e-waste recycling

R e cyc lin g F lo w D ia g ram

S a les R e ven u es

Ite m s S o ld

S a les L is t G e n era ted

R e sa le M a te ria l

S c rap R e ven u es

R e cyc le d M a te ria lsP M , C o p p e r,

P la s tics,B a tte ries , ...

D e m a nu fa ctu re

S c ra p M a te ria l

T ria ge

M a te ria l R ece ived


Primary scrap recovery for cellular phones in precious metal recovery

Recovery process also yields mixed plastic stream, copper stream (primarily from A/C adapters), aluminum stream (unique to certain models), and batteries


Parts recovery stream focuses on repair market for items such as LCDs, housings, antennas, and keypads

Additional parts recovery stream exists for integrated circuits for both repair and commodity parts markets

Significant percentage of phones are sent directly to PM recovery


Potentially hazardous components for processing Lead from tin/lead solder on

electrical interconnects in phones and accessories

Batteries--NiCad, LiIon Beryllium--potentially in copper-

beryllium alloys on connectors

Recovery Logistics

Small size and low mass of cell phones minimizes logistics issues as compared with other e-waste items

Multiple transportation options are feasible including postal and package carriers

Economics and Reuse

Reuse is a key component to current self-funding recycling programs

The reuse process typically includes the testing and refurbishing of the phones

Accessories collected in the recycling process can also be part of the reuse cycle

Economics and Reuse

Reuse economic recovery is driven by many factors Phone condition Phone type (GSM, CDMA, TDMA,…) Market conditions

Conclusion

The unique nature of cellphone recycling efforts that make them primarily self-sustaining are: Small size of phones minimizes

transportation costs Dynamic reuse market for phones PM value of non-reusable phones Minimal hazardous constituents

Marc M. LeffFounder & Chief Operating Officer

GRC Wireless RecyclingMiramar, Florida

Collection Methods - Nonprofits

• Cell Phones are Self Sustaining (the “yield” exceeds the processing cost)

•Over 100 million “retired” cell phones in the U.S.

•Easy to collect and ship due to small size.

•Collectors/donors realize environmental benefit.

Why Cell Phones as a Fundraiser?

Domestic Violence Shelters, Social Service Organizations, Religious Organizations, Schools, Community Groups, Youth Organizations, Nonprofits & More.

What Organizations are Eligible?

1. Participating organizations sign up Shelter Alliance or Recycling Alliance, and receives marketing/logistics material.

2. Organization collects retired cell phones from members & community.

3. Phones are shipped to GRC for processing.

4. Immediate payment is issued to participant.

5. Program is continuous and ongoing year- round.

How Does the Process Work?

1. Over 2000 organizations in 50 states, Canada, and Puerto Rico actively engaged in recycling through GRC programs.

2. Close to $4,000,000 raised for their causes, all through the recycling of retired cell phones.

3. Over one million cell phones responsibly recycled.

Social Benefits

1. Business & Consumers recycle phones directly with GRC to benefit local “charity partners.”

2. GRC matches “phone donor” with one of our 2000+ participants (we usually match a donor with a charity in his/her hometown.)

3. GRC recycles the phones, funds forwarded directly to “beneficiary”

4. Close to 10% of funds raised come through “3rd party” phone donors.

Business & Consumers Participate

IndividualsCorporations Schools & Government

Nonprofit Participant

Business Phone

Donations

$ $

Nonprofit Collection – The Process

Shelter Alliance Started with single domestic violence shelter in early 2002.

Program has grown to 1800+ participants in 4 years.

Over 80% of the domestic violence shelters in the U.S. participate.

Recycling AllianceLaunched in 2005.

Expansion of Shelter Alliance program.

200+ participants

Tailored for schools, nonprofits, religious and community groups.

About GRC’s Programs for Nonprofits

Located in Miramar, Florida

Website: www.grcrecycling.com

Founded in December 2001

Recycling Facility Capable of Processing 3,000,000 units annually

Founding partners have over 35 combined years in cell phone industry

Additional programs include Wireless Scrap Recycling and Wireless Asset Recovery (tailored for wireless dealers,

distributors, and repair centers)

About GRC Wireless Recycling

Collection Methods: Industry

Jenifer Chambers

ReCellular

Dexter MI

Agenda

Industry Players Collection Methods Collection Messaging Future Trends

Industry Players

1999 – CTIA Wireless Foundation and Motorola launch first recycling program: CALL TO PROTECT

2001 – Verizon Wireless launches first national retail program with HopeLine

Industry Players – cont. Carriers

SprintNextel - education T-Mobile – Huddle Up Cingular – launching in 2006

OEMs Motorola - education Nokia - reclamation

Retailers Best Buy – Boys and Girls Club Wal-mart – local charities

RBRC 30,000 collection points in US and Canada

Collection Methods In-Store Prepaid Envelopes

Box POS

Online Corporate Charitable Partners

Collection Methods: What happens to the phones?

Industry Customer Care Repair/Warranty centers Insurance programs

Resold for Personal Gain eBay “Buy one at a time” Phone swap

Donation/Recycling Programs Wireless industry Independent companies

Collection Methods: Where do the phones go?

Reuse/Recycling 65% of handsets reused in original form 35% recycled for precious metal content

Domestic/International 50% used domestically for replacement

phones or prepaid programs 50% exported for developing markets

How-To Guide: Recycling doesn’t just happen

Phone recycling is a product, and must be treated like a product Product Placement Promotion Price

How To Guide: The Participation Pyramid

Environmental

Charitable

Financial

Convenience

Participation Level

Low

High

Future Trends

Recycling solutions at all retailers Recycling solutions at all customer

interfaces Increase in employee awareness Increase in consumer awareness

Consumer Collection

James Mosieur

President

RMS Communications

Ocala, FL

Number of cell phone users increasing dramatically each year

Lack of effective recycling options for consumers with old cell phones

Frustrated consumers throwing cell phones away in landfills

Our technical expertise was well suited to develop this product

Why We Started

First direct from consumer cell phone buy back website

Launched November 2002 Over 500 models currently qualify for

payment Pay out between $4 and $200+ per

phone Free recycling option for phones not

qualifying for cash payment No cost to users

About CellForCash.com

Consumer locates phone on website

Agrees to price offered, terms and conditions

Fills out form to generate order CFC sends box to consumer Customer mails phone to CFC Customer receives payment

How CellForCash.com Works

Demographics Gender

Male - 51% Female - 43%

Age Groups 18-29 – 40% 30-39 – 23% 40-49 – 17% 50 and over – 12%

Average Transaction Data Number of Phones: 1.6 Phone Value: $29.47

Key Site User Metrics

How often do you replace your cell phone? 54% of users responded every 18 months or less

Are you committed to recycling? 82% said “Yes”

Do you think recycling electronic equipment is important for the environment?

59% said “Yes” 38% said “I don’t care”

Do you realize several states are considering making it illegal to throw an old cell phone in the trash?

79% said “No”

Are you planning on replacing your cell phone before the end of the year?

54% said “Yes”

Site Survey Results

Electronics repair and sales specialists since 1985

Senior managers have average of 12 years in the wireless industry

Two locations 140 employees with 80,000 ft2 office and processing

space Ocala, FL

Corporate Headquarters Processing facility concentrating on wholesale sales and end

of life disposal Dallas, TX

Technical services Product refurbishment, software upgrades Manufacturer returns, Warranty repair

About RMS

Questions?

Processing

Jenifer Chambers

Recellular, Inc.

Dexter, MI

Collection Box Processing

Collection Box

Received

Handsets Accessories Packaging

Recycled Refurbished RecycledRe-Use

Refurb Process

Certification Process

Available for Sale

Recycled

Collection Box Received

Re-Use

Refurb ProcessCertification

ProcessAvailable for Sale

Handsets sold in refurbed condition

Handsets scrapped and recycled

Handsets sold in certified condition

Handsets used in secondary market

Handsets scrapped and recycled

Handsets DOA

Handsets used in secondary market

Handsets DOA

Repaired, reused

Handsets DOA

Re-Use Process

Distribution – Market Segments

Four Primary Distribution Channels

Carriers Resellers Repair Facilities Brokers

Distribution - Geography

United States – 60% Prepaid applications, replacement units

Latin America – 15% Low-cost alternative to brand new

Far East – 20 % Supplemental product

Other – 5%

Regulatory Issues

Bob TonettiOffice of Solid Waste

EPA

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