Rethinking Mobile: The Rise of Refurbished Phones

Analysis

From left, Norbert Kreisz, device management center of excellence lead for Magyar Telekom, and Recommerce sales manager János Zilahi.

With the most recent Earth Day on April 22, refurbished mobile phones are emerging as a sustainable, economically savvy and eco-friendly option. With growing awareness of electronic waste and the high environmental cost of new devices, some consumers are beginning to recycle: cheap iPhones brought from a reliable source and that come with a warranty are now a trend.

On Earth Day, Magyar Telekom shared some fascinating details about its Green Magenta program, which offers residential customers refurbished devices. Mobile recycling is becoming a hot topic as the e-waste from outdated devices and the raw materials and energy required to produce new mobiles increasingly burden our environment.

“This ecological footprint can be reduced in various ways, but it is not enough if only the service providers and device refurbishment companies take action; a change in users’ mindset is also necessary, and this does not happen overnight, especially when the system has its shortcomings,” emphasized Norbert Kreisz, device management center of excellence lead for Magyar Telekom.

Electronic devices, particularly mobile phones, contain numerous environmentally harmful materials and rare metals. The worst thing you can do is throw your old mobile in the trash, but simply forgetting about it in the back of a drawer is hardly optimal either.

Telekom and Yettel are now assisting in collecting these devices by offering a discount of HUF 30,000 on new Samsung models when you bring in even non-working (but intact) old devices. These devices are taken to a dismantling plant in Hungary via the MoHu system, where each component is properly sorted and recycled.

Buying a used mobile phone can save you a lot of money, but the risk is also huge. This is true whether you buy from a private individual or let yourself be persuaded in a small, unreliable shop to buy a device of unknown history. These concerns do not arise when choosing a refurbished smartphone from a reliable, professional company.

Recommerce, which has partnered with MTel in Hungary to make refurbished mobiles easily accessible to customers, is one such player. Recommerce, which has sites in France and Romania, collects large quantities of mobile phones from multiple verified sources (including online retailers, operators, buy-back programs, businesses, and so on) and then subjects these phones to a thorough, well-organized, 56-step process.

Economically Viable?

“One percent of the incoming mobile phones are completely unusable and are dismantled and recycled. About 28-30% are not economically viable to refurbish due to being outdated or severely damaged. From these, usable components are salvaged, and the rest is recycled,” explains Recommerce sales manager János Zilahi.

“Of the remaining 70% of smartphones, half are immediately marketable after data deletion and thorough cleaning and repackaging, while the others require minor repairs; these almost invariably involve screen or battery replacement,” he says.

“The biggest attraction of these refurbished, tested, securely deleted smartphones is their much lower price compared to new ones, as well as the two-year warranty offered by Recommerce. According to a 2024 survey by [London-based global data consultancy] Kantar, the proportion of such mobiles sold in Hungary is still only 3% (the EU average is 5.5%), but the used mobile market is 14%, which is outstanding (the average is 10%),” Zilahi added.

The Kantar survey asked customers what they consider important in a resold smartphone. While 70% indicated the lower price, 28% thought the warranty and the ability to upgrade to a better device than when choosing a new phone. A relatively large percentage (37%) listed recycling as a significant aspect, showing that environmental awareness is not unknown among phone shoppers.

This is particularly important because, on average, the production of a new mobile phone uses 268 kg of raw materials and is associated with 66 kg of CO2 emissions (the total CO2 load is 85-100 kg CO2 unit). The total CO2 emissions for refurbished smartphones are 87% lower, and they require, on average, 154 kg less raw material.

Market Testing

MTel launched its program in the fall of 2023 and has thus gained some experience in the refurbished mobile market.

“During this period, they sold five-digit numbers of such phones, which we consider a good start at the company, and interest is also quite high among the younger demographic,” Zilahi notes.

Magyar Telekom’s experts confirmed that the refurbished phones accounted for 2-3% of total mobile sales during this period, indicating room for growth. Some 98% of the refurbished mobiles were Apple iPhones.

Thus, these otherwise expensive status symbol devices are now affordable for customers who, due to their limited financial resources, would previously have had to forego the brand or would be forced to buy from unverified sources. Another attraction of these pre-owned iPhones is the excellent software support: such smartphones will be supported by Apple for many years to come.

It is worth noting that if a part replacement was necessary during the refurbishment, Recommerce is not certified to use authorized Apple replacement parts. However, it ensures the new component is fully compatible and identical to the original.

This article was first published in the Budapest Business Journal print issue of May 6, 2024.

MNB Joins Capacity-building Alliance of Sustainable Investme... MNB

MNB Joins Capacity-building Alliance of Sustainable Investme...

Improving Competitiveness 'Top Priority' of EU Presidency - ... EU

Improving Competitiveness 'Top Priority' of EU Presidency - ...

Uni of Miskolc, CATL Debrecen Sign Cooperation Agreement Deals

Uni of Miskolc, CATL Debrecen Sign Cooperation Agreement

Int'l Travelers to Europe Prioritize Safety, Quality This Su... Tourism

Int'l Travelers to Europe Prioritize Safety, Quality This Su...

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.