Circular- and Performance Economy in the Telecommunications sector - A study investigating Reuse, Recycling & Leasing of mobile phones

Abstract

Telecommunication is one of the fastest growing sectors in the world and a critical infrastructure in today's society as individuals and firms are dependent on it to function. Meanwhile, emissions generated from the telecommunications sector are continuously growing and the sector is also accountable for environmental effects from waste phones and shortage of raw materials. These environmental impacts along with changing consumption patterns mean that manufacturers have to start taking responsibility and collect their products from downstream consumers to either reutilise or dispose of them correctly. Several other industries are adapting to a “new” type of economy to meet customer demand and increase sustainability. This, so called Performance Economy, is a part of the Circular Economy and makes use of renting or leasing products to sell goods as services. Thereby the ownership of products shifts from customers to manufacturers, making the manufacturer responsible for costs, risks, and waste. However, despite the fact that one of the main objectives for the Performance Economy is environmental sustainability, the model requires additional logistics which entail some environmental costs. Therefore, it needs to be made sure that the model is in fact sustainable for the telecommunications sector. Moreover, firms need to adjust to customers´ preferences for the business model to be a viable alternative. This thesis will therefore investigate whether the Performance Economy model could be a possible way forward for the telecommunications sector when selling mobile phones. Specifically, with regard to the environmental costs of the logistics required for the reuseand leasing model as well as customer preferences. This is done through a case study of the biggest telecommunication operator in Sweden, Telia Company AB, which includes a SWOT-analysis of implementing the Performance Economy model within the telecommunications sector. Finally, it is found that the Performance Economy could be a possible way forward for the telecommunication sector when selling mobile phones in terms of environmental sustainability and customer demand. However, these findings are dependent on some specific prerequisites.