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Gartner Says Emerging Markets Could Become Dumping Grounds for Secondary PCs

By 2012, Emerging Countries Will Need to Dispose of 30 Million Secondary PCs Annually
STAMFORD, Conn., June 24, 2009 — Demand for secondary PCs will outstrip supply for years to come, but reuse does not necessarily mean "greener" IT because growing exports for reuse or recycling are leading to increasing e-waste in emerging markets, according to Gartner, Inc.

"Although reuse must be considered preferable to most other forms of waste management, without effective controls, exports for reuse can be an excuse for dumping, and even in the best case result in 'passing the toxic buck' to emerging economies, which are seldom equipped to deal with this problem in an environmentally and socially responsible way," said Meike Escherich, principal research analyst at Gartner.

In 2008, 37 million secondary PCs were refurbished and exported to emerging markets, and Gartner predicts that this number will rise to 69 million by 2012. A secondary PC is one that is repurposed after its primary use (as a new PC) has ended. Secondary PCs must have been used in the installed base for more than 120 days to be considered secondary use.

Gartner found that the demand for secondary PCs has increased as the global recession has tightened its grip. As product life cycles lengthen, demand for secondhand PCs is outstripping supply. Even when the markets recover, shortages of used PCs will continue as large volumes, especially of notebooks, will be too old to have a useful second life span.

These secondary PCs will eventually need to be disposed of. In 2007, nearly 68 million secondary PCs had to be discarded worldwide. In emerging countries, approximately 15 million secondary PCs had to be discarded in 2007. Gartner estimates that by 2012, emerging countries will need to dispose of a total of 30 million secondary PCs annually.

"Without action, OEMs will find that an increasing number of their PCs will either end up in landfills or find their way into illegal or badly set up private 'workshops' for dismantling," Ms. Escherich said. "Neither will be advantageous for a vendor's 'green' credentials."

A thriving international trade has emerged for used PCs, largely from mature to developing countries. Exporting brings important benefits, contributing significantly to the operations of schools, small businesses and government agencies. Furthermore, extending the life cycle of PCs prevents substantial environmental damage. Gartner believes that the manufacturing phase accounts for up to 70 percent of the natural resources used in the life cycle of a computer, and extending the lifetime via second use provides an important environmental service.

Although some exported used PCs are handled responsibly in demand countries with effective regulatory regimes and by companies with advanced technologies, many end up in developing countries where they are frequently handled and disposed of unsafely. Emerging economies often lack the capacity to safely handle and dispose of used PCs, and extremely low labor costs and lack of environmental controls make unsafe recycling commonplace.

"Although repair and reuse are worthy goals, without efficient enforcement of worldwide legislation and controls, they are simply loopholes allowing for 'greenwash,'" said Charles Smulders, managing vice president at Gartner. "The fact remains that every single one of these PCs must be disposed of sometime, somewhere and somehow."

Until a universal enforcement mechanism is developed and effectively implemented, consumers and businesses aiming to be environmentally responsible with their used PCs should be skeptical of companies that claim to responsibly recycle these devices.

Ms. Escherich advised PC vendors to seriously consider adopting the same standards globally that they are legally bound to adhere to in stringently regulated regions, such as Europe and Japan. "After all, nothing exposes 'greenwash' more dramatically than an A-branded PC found dumped in a developing country in Asia or Africa," she said.

Additional information is available in the Gartner report "Dataquest Insight: Emerging Markets Are Becoming Dumping Grounds for Secondary PCs." The report is available on Gartner's Web site at http://www.gartner.com/DisplayDocument?ref=g_search&id=990315&subref=simplesearch.

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