A Greener Take on the Smartphone Is Coming to Europe’s Biggest Carrier

(Bloomberg Businessweek) -- As far as human rights and the environment are concerned, smartphones are a nightmare. They're packed with metals mined in war zones. They're built in working conditions it would be generous to call questionable. They're difficult to repair. And they're really hard to recycle upon their planned obsolescence, meaning they quickly add to the world's growing pile of toxic electronic waste. For six years, a company in Amsterdam has been trying to break that cycle. Finally, Eva Gouwens says, people are starting to take notice.

Gouwens is the chief executive officer of Fairphone, whose modular designs make its smartphones relatively easy to repair—or to upgrade in an effort to extend their lives beyond those of the average iPhone or Samsung Galaxy. Gouwens's latest model, the $495 Fairphone 3, is made partly from ethically sourced metals and recycled plastics. (Fairphone wouldn't say how much its assembly-line workers in Suzhou, China, make hourly except that they get a $1.65 bonus per completed phone.) While the company has sold only 175,000 of its first two models since 2013, compared with the 1.6 billion phones other manufacturers sold around the world just last year, the Fairphone 3 is getting a big boost from a once-reticent partner: Vodafone Group Plc, Europe's biggest wireless carrier.

Vodafone announced in November that it will sell the Fairphone 3 in Germany, Ireland, Spain, Italy, and the U.K., countries where it collectively has more than 80 million wireless subscribers. Vodafone is promoting the Fairphone with the help of popular bloggers and a social media campaign featuring its German CEO. Fairphone estimates it will more than double sales next year, to 150,000 phones. “All the business models are focused on selling as many phones and getting rid of them as quickly as possible,” Gouwens says. “We want to show you can be commercially successful and make more ethical choices in your supply chain.”

The Fairphone 3's tech specs will look pretty familiar if you last bought a smartphone a few years ago. It's got a screen about the size of a Google Pixel 4; a processor common in midlevel phones from last year, such as the Huawei Honor 8c; and a battery that'll get you through the day, plus decent front and rear cameras, a headphone jack, a USB-C port, and a fingerprint scanner. It runs on the not-quite-latest Android software. But there's one item in the Fairphone box that makes it special: a screwdriver allowing users to take apart the phone and replace seven components, including the battery, screen, camera, and speaker.

Most phones are hard to modify for extended longevity. Crack open your iPhone or Galaxy, and you'll void the warranty for some expensive parts. In large part because of Fairphone's DIY ethos, Gouwens says, the high rate of adoption for its latest software updates suggests that about 65% of all the phones the company has sold since 2015 are still in use.

In Peru, the company buys only gold, used in small quantities in smartphones as a powerful conductor, that's been certified as “fair trade”—an international standard for fair wages and safe working conditions. In Uganda, it's setting up child-labor-free zones to keep kids in school and providing miners with better equipment to reduce the use of toxic mercury as an extraction agent. Fairphone is making similar efforts for tin and cobalt, which are used in phone displays and batteries, respectively. This is just a start, Gouwens says. A modern phone is made from about 40 minerals, many of which don't yet have sustainable alternatives.

Fairphone began in 2010 as an advocacy group opposing the use of conflict minerals in electronics. It started making its own phones, it says, out of frustration with the industry's lack of progress on that front. Despite early backing from wireless carriers such as KPN NV in the Netherlands and Orange SA in France, the company has been broadly ignored for years.

Yet the public mood is shifting, and consumers are questioning long-held habits. Fast fashion is being criticized for its heavy water use and its disposable clothes. Meat alternatives are finding their way into Burger King and Dunkin' outlets, not just family-owned vegan joints. And public support for green political parties and environmental activists around the world is putting more pressure on a wide range of polluting industries to clean up. “Younger customers increasingly want sustainable products that make a positive environmental impact,” says Ryan Holowka, a sustainability manager for Vodafone. “We're convinced there's a market for it.”

Even if Fairphone thrives, commercial electronics sustainability has a long way to go. “The big players in the smartphone industry haven't yet demonstrated an interest in making their phones more sustainable,” says Christian van de Sand, an analyst for the Stiftung Warentest, the German equivalent of Consumer Reports. Consumer electronics discarded each year outweigh all the commercial jets ever built, according to the World Economic Forum. Only a fifth of that gadget waste is recycled. “I don't need the best phone in the world,” Gouwens says. “I need the best of the world in my phone.”

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net, Jeff Muskus

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