The $45-$80 billion circular opportunity for telcos

via Flickr © (CC BY 2.0)

via Flickr © (CC BY 2.0)

  • There is somewhere between $45 to $80 billion worth of annual ‘value’ available to the world’s telcos
  • That’s if they adopt what Telia Company and Accenture are calling Circular Principles
  • The two companies lay out the new circular role in a new report published to coincide with Earth Day

‘Circular Economics’ is not just finding new words to describe crushing the old to make the new, but is actually about designing re-use right into a product or service at the outset.

This sort of idea has been around for decades, maybe centuries (ever since Noah said, “I’m so hungry and I’m wondering, do we really need two cows?”) But now recycling in all its guises is back in the spotlight it never really left, partly because material waste is linked with energy use and climate change and the current urge to ‘build back better’ in the wake of pandemic is a powerful impulse. Circularity might also be an earner to move the revenue needle for hard pressed CSPs. 

Telia Company has presented new circularity goals for its business which it plans to meet within  a decade, including:

  • 84% of waste materials from both its own operations and from network construction and maintenance it has contracted from others will be re-used or recycled by 2025.

  • Plus, the company will significantly increase sales of pre-owned/re-used mobile phones as well as phones sold “as a service”. “Device as a service” is a pay-for-use model enabling Telia to prolong the lifetime of devices through repairs, upgrades and refurbishment. It also ensures that phones are returned to the company for reuse or responsible recycling when no longer in use, instead of being left at home in drawers.

Anders Helmrich, Telia Company client account lead at Accenture, believes it’s time for telcos to lead on these sorts of efforts, not just participate in them. “Telcos are uniquely positioned in the ecosystem to act as an enabler for other industries to deploy digital and circular solutions, but at the same time can now also act to improve their own footprint toward a net-zero future,” he says. 

The circularity of a business model is essentially helped by the initiator or the first player in the circle having a stake in the final outcome. This provides a spur to design a product or service for profitable re-use. So a phone designed to have a long life by being robustly constructed, or having a modular nature so that it can be refurbished with a replacement battery and memory, will be a positive assist for the cycle. Phones seemingly designed for planned obsolescence will usually involve perverse incentives which go against recycling (just as a simple example). 

There is certainly still much scope for improvement on re-use. The report makes the point that regulation can play a big part in getting the circular ball rolling, as it were, and it observes that the EU and many governments and companies are pushing things forward. At the moment, though, only 9% of material inputs in the global economy are cycled back. 

So where does that $45 to $80 billion come in?

Accenture claims it has defined five circular business models to help organisations identify ways to capture new circular opportunities:  Circular Inputs; Sharing Platforms; Products as a Service; Product use extension and Resource Recovery Based on these models it’s identified three potential roles for telcos. 

Embedding circularity in operations - worth $20 - $30 billion

Offering circular products and services - worth $15 - 20 billion, and

Enabling a circular ecosystem - worth $10 - $30 billion

You can download the full 42 page THE SHIFT - the role of telcos in the circular economy report here

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