There comes a time in the life of every PC when it gets rejected by its owner. Reproduce this act several thousand times a year and you get some idea of the enormous headache that redundant computer kit poses for corporations.
It costs up to #450 to ensure the safe disposal of just one PC, according to IT consultancy Gartner Group. But Paul Bentley, PC brand manager at IBM UK, reckons Gartner?s estimate is too high. ?Our customers operate on the assumption that a PC disposal will cost #100 to #150,? he says. Even at the lower price, costs add up very quickly indeed.
Currently, it is cheaper to dump unwanted PCs than to store or recycle them. Less than 10 per cent of electronic waste is recycled in the UK, according to the Centre of Science and Technology, which estimates that six million electronic items go to UK landfill sites each year, containing material worth an estimated #50m.
No one is keeping count of the numbers of computers dumped in the UK. But in the US, Carnegie Mellon University estimates that 55 million PCs will end up on landfill sites by 2005. A rough calculation based on this figure suggests that at least five million PCs will have been dumped in the UK?s rapidly filling landfill sites by then. And, aside from the sheer numbers, there are other concerns. Dumping is environmentally unsound because computer components often contain toxic materials. Monitors are particularly noxious because cathode ray tubes contain highly poisonous cadmium.
But, if the Government gets its way, the economics of dumping could change. In his first Budget, the Chancellor, Gordon Brown, said he was minded in future to raise landfill taxes, currently standing at #7 per tonne. Industry commentators predict taxes will double ? perhaps as early as the next Budget.
It is anticipated that forthcoming EU legislation will turn the screw even tighter. A draft proposal due out this autumn is expected to introduce the notion of producer liability. This will include a requirement for manufacturers to take back used computers. A second proposal under consideration, based on Swedish legislation, proposes to ban completely the disposal of computers in landfill sites.
In the UK, companies that dump their old PCs are obliged to receive a duty-of-care certificate from the skip company which guarantees the waste will be disposed of legally. So you will avoid prosecution if your skipper turns out to be a fly-tipper.
Dumping on the cheap is risky. Lincolnshire County Council was left with egg on its face earlier this year when computers sent for scrap turned up on the secondhand market. To add to the council?s embarrassment, the computers contained details of 50 child-abuse cases. Under the Data Protection Act, it is a criminal offence to discard a computer containing personal data. Failure to data-wipe the hard disk can result in Crown Court prosecution and unlimited fines. Furthermore, companies that fail to do this can be sued by injured individuals.
Government thinking on waste management is based on the three Rs: reuse, remarket and recycle.
Corporations are used to the notion of reuse. In times gone by, that old 286 would be converted into a print server. Today, its life can be extended even further as a Web station ? Caldera claims its Webspyder browser software can do precisely this. But there can be enormous logistical difficulties for companies to cascade thousands of PCs through the organisation ? particularly when kit is scattered among hundreds of branches. What?s more, cascading has a limited shelf life because residual values collapse on machines older than four. More importantly, the cost of ownership rises significantly when more than three or four PC configurations have to be supported.
Often it makes more economic sense to plough back the residual value of secondhand PCs into the equation when buying new kit, particularly when laptops are involved. On the desktop side, Compaq kit carries very good valuations. Pentiums are becoming increasingly common on the secondhand market, and 486s remain highly tradeable. Anything more primitive is worth very little.
A manufacturer may operate trade- in policies, typically wrapped up in finance deals. Dell, Compaq and IBM are all active players in the so-called technology refresh market.
The secondhand PC business is booming. In the early 1990s, surplus inventory units and end-of-lease PCs were the main sources of the secondhand computer trade. Today, corporate disposal has emerged as a third and even more important source of supply. PCs are sold through auction houses, through small ads in the national press, in Micro Computer Mart, through back street retailers, or they are cannibalised for spare parts. PST, the UK?s biggest trader in surplus computer inventory, ships thousands of redundant PCs to Eastern Europe and Africa.
Many companies are now giving away their old computers to charities or schools. While laudable, it is advisable to do this through a reputable trader, a broker who will issue a certificate of safety and assume responsibility for the PCs. Without such a certificate, the onus of liability lies with the original owner should the machine blow up after it is donated. Even when it comes to charitable acts, you can?t be too careful.
Brokers or remarketers can earn far more money from secondhand PCs than corporations can expect to achieve by themselves. They will buy millions of pounds-worth of surplus inventory from the manufacturers ? hard drives, CD-ROM drives and memory ? and will ?lose? them in secondhand PCs. This extends the life of the PC, increases its sales value, and also unclogs the route to market for manufacturers that want to sell new products.
Technical Asset Management (TAM) of Welwyn Garden City and Essex-based RD Computers, a subsidiary of stock market-listed IT distributor Datrontech, are the UK?s leading remarketers, each turning over about #15m a year. PCs are data-wiped to US military standards, cleaned up and then filtered out through the brokerage market into schools, hospitals, auction houses, charities and IT maintenance companies. Less than two per cent of the 55,000 computers coming into TAM?s hands have to be sent for recycling, says managing director Kevin Riches.
RD Computers and TAM both say their corporate customers are mainly concerned that hard drives are fully data-wiped before disposal. Others want nothing more than a free removal service. But there is hard cash to be made ? for those who are interested.
Corporations typically get 10 to 15 per cent of the original value of the unit, according to age and condition, with secondhand market values for notebooks going as high as 30 per cent. RD Computers usually pays up-front for kit ? which is good for cash flow. According to managing director Rod Best, this is a minor consideration for most companies: ?They have usually written off their assets to zero and have a problem about where to put the money. Quite often, we are asked to donate money to charity.?
RD Computers has an efficient selling mechanism, in the form of its Nationwide Computer Auctions business. This sees 1,500 people pass through its doors each week.
TAM takes a different approach. It compiles an asset register of equipment intended for disposal and splits the proceeds with clients. Riches argues that companies, if they are prepared to be patient, can get up to twice as much money using this route, compared with traditional brokers.
The secondhand PC market is a rare example of ?seller beware?. To achieve the best valuations, deal with reputable traders. Many are small-time brokers that will agree to buy only what they have already sold ? which is reasonable. Many exploit the ignorance of customers to offer far below market price. This is also reasonable ? if you are the broker. Check the bona fides of prospective brokers. Insist on auditing their data-wiping procedures, double-check their recycling facilities and chase up references.
After all, you do not want your PCs to be illegally fly-tipped or turn up on the market with sensitive personal information. The embarrassment of seeing your company plastered all over the newspapers will far outweigh any money you may have made on the deal.
FREIGHT firm breathes life INTO OLD PCs with citrix software
One of the most interesting possibilities opened up by the recent wave of excitement about NCs and other ?thin client? alternatives to conventional PCs is, paradoxically, a new lease of life for old PCs.
Panalpina, a large international freight forwarding and transport company, is now using a mixture of the very latest Wyse Winterm thin clients and redeployed old 386 and 486 PCs in its UK and Irish offices.
What makes this possible is a modified version of Windows NT called Citrix Winframe. This allows the running of Windows applications such as Word and Powerpoint to be split between desktop machines and a central server. The bulk of the work is done at the NT server end, which leaves the desktop machines with little to do other than handle the updating of the display and keyboard and mouse input ? things that don?t need much power.
Panalpina bought new Wyse desktop machines for some of its 180 local users, but kept the old PCs and turned them into thin clients with the addition of Citrix ICA software. IT manager Andrew Tidd says that even old 20MHz 386 machines with as little as 4Mb of memory perform well when linked through to the Winframe servers. Panalpina staff are now using them for tasks like word processing, email and SAP accounts.
Microsoft is now backing the Citrix approach and will be launching its own multi-user version of NT, co-developed with Citrix and code-named Hydra, sometime after Christmas. So don?t throw away those old PCs just yet if you?re a corporate Windows user.
Guide to recycling
The Industry Council for Electronic & Electronic Equipment Recycling (ICER) is compiling a directory of recyclers and remarketers that will be available to businesses, local government and the public. It is expected to be published by the end of the year.
For more details, contact ICER at 6 Bath Place, Rivington Street, London EC2 3JE.
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