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Digital gold: Turning techno-junk into cash

As the economy pinches budgets, more U.S. consumers are scrounging their junk drawers in search of a little gold: digital cameras, cell phones and other digital remains.
Image: Electronic waste
Your junk may be worth a few bucks. David Best, president of Prism Software, unloads old computing equipment into a pile at an e-cycling event in Bloomington, Minn., last year. Dawn Villella / AP file
/ Source: contributor

As a hungry grad student, Brandon Mendelson can sum up his financial status in two painful words: “broke” and “desperate.” He needs quick cash to help cover his living expenses, including food and health insurance.

But where to look? Mendelson scanned his campus at SUNY Albany and saw possible salvation in the trash stream. Not beer bottles or discarded newspapers. Today’s garbage: digital debris.

Last week, Mendelson began using his Facebook page to solicit empty ink cartridges and old cell phones from friends, fellow students and others too busy to properly dispose of them. His plan is to stockpile the donated techno-junk in a cardboard box in his spare bedroom and ultimately recycle the material with a few of the rising number of companies that offer dollars for e-waste. Already, Mendelson has sent several unwanted cell phones to Toshiba, reaping about $11 for each.

“It’s pocket change, but when you have an empty food closet, everything counts,” said Mendelson, who is studying history and media at the upstate New York college. “Health insurance is our biggest expense – $917 or so for every two months – so as I expand this (collection effort), my goal would be to help pay for the insurance. I have a heart condition so I have to stay covered.”

As the economy pinches wallets and budgets, more U.S. consumers like Mendelson are scrounging their junk drawers and bedroom closets in search of a little gold: long-idle desktop computers, digital cameras, gaming consoles, cell phones and other digital remains. These folks are, in turn, plugging into the surge of tech manufacturers and retailers that are aiming to green their image by launching recycling programs — a marriage made in e-waste heaven.

Two weeks ago, RadioShack kicked off an electronics trade-in program that allows consumers to use an online calculator to tally the value of their aging GPS devices, MP3 players, wireless phones, notebook computers and tech products. If people agree with assessed prices they see for their unwanted gadgets, they can ship them to the company for free. About two weeks later, RadioShack will send them a company gift card.

Last year, Staples became the first national retailer to offer in-store recycling for all brands of larger office equipment such as desktop computers, printers and fax machines. Customers typically pay a $10 fee for the service, while there is no cost for handing in keyboards, cell phones and PDAs. But between Oct. 12 and Nov. 15 this year, Staples began giving customers $30 in Staples Rewards (price discounts) for recycling old tech products like printers and then purchasing replacements from Staples in the same category. (Staples also hands consumers $3 in-store coupons for each ink cartridge they recycle with the company).

“People know they can’t just throw old printers and CRT monitors in the trash and they don’t know what to do with them, so they’ve been piling up around people’s homes,” said Scott Rankin, vice president for technology and merchandising for Staples. “We’ve even been getting some of those old dot matrix printers from three generations ago.”

But Toshiba may be the company that’s connecting most deeply with the financial headaches felt by many Americans, offering cash in return for unused or nonfunctional computer desktops and laptops, video gaming consoles, iPods, cell phones, camcorders and digital cameras. Consumers who visit Toshiba’s website can use an online calculator (similar to RadioShack’s) to instantly gauge the value of their old tech toys. For example, a Dell Intel Pentium M Centrino laptop that works but is in poor condition will fetch $28 (or $52 if it’s in good shape). The items can be shipped to Toshiba for free, and participants are not required to buy anything from Toshiba in return.

How much is the financial crunch spurring a junk-drawer recycling boom? Between 1999 and 2005, Americans recycled about 15 percent of their outdated or broken digital items – a pace that held firm for those six years. In 2007, Americans recycled 18 percent of their old gizmos, according to the Environmental Protection Agency.

Just during this past July and August alone, Toshiba paid its e-recycling users $8,448 for their unwanted pieces of technology, and the company says 90 percent of the people who use the program are seeking cash in exchange. Many companies are hoping to use the recycling give-backs to tap into this year’s Christmas shoppers.

“We know that consumers are looking for innovative ways to save money,” said Peter Whitsett, the executive vice president of merchandising for RadioShack. “And we think (our) program will help them stretch their dollars in time for the holiday shopping season.”

“I am a consumer that definitely turns in my old cell phones, cameras and computer equipment for cash,” said LaTosha Johnson, a marketing consultant who lives in Elmhurst, Ill. “Just last month, I turned in my cell phone to Sprint and received a $15 credit that will be applied to my phone bill.”

Johnson also squeezed value out of some unused gadgets the old fashioned way, selling a printer and a digital camera to a pawnshop for $80.

“It enables me to have a little extra money in my pocket, which is something everyone can use these days,” Johnson said.

For generations, recycling programs only worked if they were convenient to consumers. But experts say that monetary enticements are equally effective at luring new users.

“Access to a recycling program is the No. 1 factor in success, but you’re going to definitely juice up your participation rate with incentives (like giving cash back),” said Ed Skernolis, executive director of the National Recycling Coalition.

At the corporate end of this trend, there are incentives, too, Skernolis added. Those include a company’s image in this environmental age as well their adherence to as a slew of new recycling laws. Eighteen states now govern how old technology is discarded.

“Absolutely, there is a certain greening of corporations going on here,” Skernolis said. “If company ‘X’ has 10 percent of the market, they should expect to be retrieving 10 percent of the products. It becomes a market responsibility.”

At the same time, though, collecting e-waste also has become a promising marketing tactic, companies acknowledge.

“We are focused on (recycling) as part of our brand DNA,” said Mona Pal, product manager at Toshiba. “We don’t, to date, see a measurable impact on business (simply) because we have more green products (or because we are offer recycling). But this is not something we’re doing as a business strategy. It’s something we’re doing as a brand strategy.”

Staples, meanwhile, sees recycling as part of its customer service model – the same way it views helping people set up their home computer networks. But making future sales is definitely included in their thinking.

“If a customer buys a printer from Staples it’s our responsibility to take that back when they’re done with it. And we hope they’ll come back to us when it’s time to buy their next component,” Rankin said.

Staples says that it has recycled 2 million pounds of technology since 2007, including 24 million ink cartridges and more than 25,000 cell phones and PDAs. Toshiba has set a goal of recycling 12 million pounds of e-waste by 2010.

No doubt, the rate at which tech refuse is stacking up in America’s homes and landfills is creating fresh urgency. E-waste accounts for 2 percent of the garbage stream and is rising. Some 133,000 computers are thrown away daily in this country, says Staples.

Replacement cycles are growing shorter as well for laptops and cell phones as the technology leaps forward. Between 1980 and 2005, 180 million electronics products had accumulated in drawers and on shelves in U.S. homes, the EPA says. Since 2005, that e-waste collection has ballooned to 235 million pounds, including 66 million pounds of old desktop computers and 99 million pounds of broken or unused televisions.

But if you choose to recycle your gadgets, where do they go? According to watchdogs like the Basel Action Network, about 80 percent of the U.S. e-waste supposedly headed to recycling is put on container ships and exported to countries like China, creating black markets for digital trash and secret, heavily polluted technology-breakdown sites.

Toshiba promises that for the old tech items it receives that can’t be recycled, it “will dispose of the products responsibly.” Toshiba has also partnered with the Rechargeable Battery Recycling Corporation and with eBay’s Rethink initiative to keep unwanted digital products out of landfills. At Staples, Rankin said he has personally walked through and audited its chosen recycling centers to watch the old machines get crunched down safely and cleanly into raw materials destined for reuse.

But when consumers like Johnson and Mendelson are mainly mulling quick cash when they recycle their gizmos, does a cell phone’s final resting place ever enter their minds?

“I really never gave it that much thought,” Johnson said. “But I’d always hoped it would go to someone who really needs it.”

“I’m always concerned,” added Mendelson. “But admittedly, I have blind faith that Toshiba is doing the right thing when it comes to recycling these products. Right now, we have to worry about getting by.”