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Mobile Services Industry

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The aim of this paper is to assess the mobile industry‟s current state and develop a business rationale and framework for sustainability that fits the unique needs of the mobile services industry. ...

The aim of this paper is to assess the mobile industry‟s current state and develop a business rationale and framework for sustainability that fits the unique needs of the mobile services industry. In addition, recommendations are given that can further the mobile industry‟s sustainability agenda.

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    Mobile Services Industry Mobile Services Industry Document Transcript

    • Sustainability Assessment of the Mobile Services Industry Rudi Anthony, Justin Bean, Jenn Coyle, Giles Hayward, & Kelly James Rudi Anthony, Justin Bean, Jenn Coyle, Giles Hayward, & Kelly James Industry White Paper, May 11, 2011 Industry White Paper, May 11 2011
    • Table of ContentsExecutive Summary .......................................................................................................... 3Mobile Services Industry Background ............................................................................ 3Industry Trends ................................................................................................................. 6Rationale for Sustainability ............................................................................................ 10The Natural Step Framework .......................................................................................... 11Vision for a Better Mobile Future ................................................................................... 12Major Impacts Related to the Industry........................................................................... 13 Mobile Industry Value Chain ...................................................................................................... 13 Major Impacts in Industry ........................................................................................................... 13 Economic Impacts ...............................................................................................................................14 Environmental Impacts ........................................................................................................................15 Social Impacts .....................................................................................................................................16Metrics .............................................................................................................................. 17Key Players and Best Practices ..................................................................................... 19 Vodafone ................................................................................................................................... 19 China Mobile .............................................................................................................................. 20 AT&T ......................................................................................................................................... 21 Other Mobile Services Companies or Organizations .................................................................. 22Sustainability Reports and Results ............................................................................... 23Conclusion ....................................................................................................................... 26References ....................................................................................................................... 27
    • Executive SummaryThe mobile services industry is one of the fastest growing industries in the world with over fivebillion users. The industry provides telecommunication and information services, including voicecalls, short message service (SMS), internet access, picture and video messaging, and other dataservices, to 90 percent of the world‟s population. Due to the ubiquity of mobile phones, mobileservice providers can play a key role in helping to shape a more sustainable society. Not only domobile services providers bring access to telecommunications and information and that drivessustainable development in emerging markets, but these companies also develop products andservices that can enable a low-carbon society. The aim of this paper is to assess the mobileindustry‟s current state and develop a business rationale and framework for sustainability that fitsthe unique needs of the mobile services industry. In addition, recommendations are given that canfurther the mobile industry‟s sustainability agenda.Mobile Services Industry BackgroundThe mobile services industry is defined as those companies, which together enable the provision oftelecommunication, information, and entertainment services including voice, internet, SMS, text,and other data services. It is comprised of thousands of companies offering mobile servicesworldwide; some of the largest include Vodafone, China Mobile, and AT&T. As is shown in Figure1, Vodafone is narrowly the largest mobile operator by revenue. However, China Mobile is thelargest in terms of subscribers and coverage, with over 600 million subscribers.
    • Figure 1. Mobile Services Industry - Annual Revenues (Ohanen, 2011)Revenue collected by mobile service providers totaled $675 billion in 2009, and is expected to top$870 billion by 2014 (Teral, 2011). As seen in Figure 2, voice messaging makes up the largest partof the mobile service industry. SMS also contributes greatly to the revenue of the mobile servicesindustry with five trillion messages sent in 2009. Despite the growing popularity of mobile email,Instant Messaging (IM) and Multimedia Messaging Service (MMS), SMS is still predicted to exceed10 trillion messages in 2013. However, the majority of growth over the next three years will comefrom mobile broadband services, which jumped by 36 percent in 2009 and are expected to doubleby 2014 (Teral, 2011).
    • Figure 2. Worldwide Mobile Broadband Service Revenue ProjectionsMobile services providers operate in four areas: 1) mobile networks, 2) mobile handsets and otherhardware, 3) retail presence, and 4) other data services, including mobile money and mobile health(m-health) services.Access to mobile networks is now available to 90 percent of the world‟s population and 80 percentof the rural population. According to the Information & Communications Technologies Group (ICT)at the World Bank, there are an estimated 5.3 billion mobile cellular subscribers worldwide,including 940 million subscriptions to 3G services. As mobile phones become more affordable,emerging markets are acting as the engines for growth within the industry (Figure 3). Since 2002,mobile penetration in developing countries has grown 321 percent compared to 46 percent indeveloped countries (Vital Wave Consulting, 2008). Moreover, growth rates in new subscribers arehighest in Asian and African regions (Figure 4).
    • Figure 3. Mobile Penetration Growth in Emerging & Developed Countries (Vital Wave Consulting,2008)Figure 4. Mobile Subscriptions per 100 Inhabitants (ICT, 2010)
    • Industry TrendsThe primary drivers of the mobile industry up to now have been dominated by growth in revenuesand subscribers. Keeping up with this pace of growth places great pressure on the planet‟secosystem and natural resources, but also opens opportunities for positive impact. Beyond puregrowth, there are several trends currently shaping the way businesses in the mobile servicesindustry operate.Changing Revenue ModelsIncreased competition among the thousands of mobile service providers contributes to price wars,which are leading to reduced revenue and profit margins. In response, the makeup of mobileservice providers‟ revenue is shifting to include more mobile application and enhanced servicerevenue, such as mobile application (app) purchases, which are increasing at an average of 160percent per year since 2009, (“Mobile Media Intelligence”, n.d.). In-app purchases, mobileFigure 5: Changes in Mobile App Revenue payments, mobile banking and advertising are(eMarketer, 2011) also growing sources of revenue for mobile service providers. According to Sid Ugrunkar, founder of bSmart, a provider of Wireless Enterprise software solutions, mobile advertising is emerging as the “hot topic” in India‟s mobile marketplace and presents ample opportunities for brands to capture the attention of the growing consumer market. With bSmart, Sid has observed huge shift inthe requests from their clients to embed mobile advertising capabilities in their softwareapplications in order to capture the huge revenue opportunities from this nascent market (S.
    • Ugrunkar, personal communication, May 2011). Moreover, a greater percentage of revenue iscoming from emerging markets due to the higher subscription growth rates (ITU, 2010).Figure 6. Global App Revenues and Growth. (cnet News, 2011)Tightening Environmental LawsIn the European Union, Restriction of Hazardous Substances (RoHS) legislation placed restrictionson the amount of hazardous materials contained in electronic devices including lead, mercury,cadmium, and chromium. While the Waste Electrical and Electronic Equipment (WEEE) electronicstake-back law has created incentives for international companies to reduce toxins in manufacturingand to implement cell phone take-back programs (“RoHS Compliance in the EU”, n.d.). In the U.S.,states are adopting take-back laws and three states have already prohibited cell phones frombeing thrown away: California, Maine and New York (“State Legislation”, n.d.). Proactivelyaddressing these compliance trends will help companies remain competitive when regulationstighten in the future.Scarcity of Natural ResourcesMobile phones require a large variety of natural resource inputs, including rare earth metals. Theseresources are becoming scarcer due to growing demand across the entire electronic industry aswell as the impacts of mining these materials (“Environmental Impacts of Cell Phones”, 2008).Ensuring cost-effective access to these material inputs is an important challenge and is motivatingcompanies to initiate handset recycling and reuse programs.
    • Closing of the Digital DivideResearch has shown that increased connectivity helps drive social and economic developmentparticularly in the developing world (Vodafone Group Foundation, 2008). Mobile penetration hasincreased by 320 percent in emerging markets, and now the mobile phone has surpassed thepersonal computer as the primary point of contact to the Internet (Vital Wave Consulting, 2008).Mobile technology is opening up new markets and bringing greater access to information andcapital to more segments of society.Mobile Applications with Social BenefitMobile technology is being applied to improve users‟ lives in a variety of ways including mobilebanking, economic development, delivery of health services, citizen empowerment, and greateraccess to media and education. Non-governmental organizations and social entrepreneurs areincreasingly leveraging mobile technology in their work to enrich and serve communities withmobile applications for advocacy work, disaster and humanitarian relief, and environmentaltracking. Sid Ugrunkar, founder of bSmart, identified increasing expansion of peripheral healthdevices, especially in emerging markets like India. As a result, over the last few years, the numberof clients requesting bSmart‟s services to develop healthcare applications has greatly increased.One of the company‟s newer clients is a leading pharmaceutical company that is launching a drugfor Asthma patients in India and is interested in creating a dosage reminder application. In order toreach the largest segment of mobile users, bSmart is developing an application for sending SMSalerts to patients in India who are using the drug. He predicts that the penetration of tablets suchas the iPad will emerge as catalysts for innovative mobile health applications to grow in usage overthe next few years (S. Ugrunkur, personal communication, May, 2011).
    • Rationale for SustainabilitySustainability is a strategic imperative for the mobile services industry because rapid growth inmobile connectivity not only presents new opportunities for the industry, but exposes it to greaterenvironmental and social liabilities as well. These liabilities can even include legal accountability(Martin, 2010). Expansion in the availability of information and communication makes the actions ofthe industry more visible and subject to criticism for any practices that are deemed unsustainableby stakeholders. However, with a more connected world, the mobile services industry stands togain access to customers with greater education, health, and financial resources. Implementingsustainability as a business strategy can provide more sustainable revenue, assist in the mitigationof social, environmental, and economic risks, and provide economic growth into the future (Porter& Kramer, 2011). The creation of new markets through sustainable mobile services has thepotential to create massive new opportunities for local and global business. These new marketscan be created by taking a shared value approach, in which the mobile services provider assessesthe unmet needs of the community (especially in regards to communications, information, andother needs directly related to mobile services), and addresses those needs in ways that leveragethe unique expertise and value offerings of mobile service providers (Porter & Kramer, 2011).If growth continues without consideration of the associated environmental and social liabilities, thenthe industry stands to lose the trust of its customers and forgo opportunities to increase revenue bydelivering new services to developing markets. Ignoring the sustainability imperative exacerbatesrisks such as price volatility in raw materials, erosion of the middle-class customer base, and lossof market share as more sustainable technologies and services emerge (European Commission,2011). Therefore, it is in the best interest of the mobile services industry to integrate sustainabilityinto its strategic planning in order to reap the benefits of sustainability, and avoid the risks ofignoring it.
    • The Natural Step FrameworkThe Natural Step (TNS) framework helps to bring a vision-oriented approach to tackle theindustry‟s sustainable development opportunities and challenges. Factors that make thisframework unique include its focus on building a plan for sustainability based on four principles anduse of backcasting to evaluate each possible action for its strategic value. TNS is based onsystems thinking; acknowledging that what happens in one part of the system affects each otherpart, and provides an overarching process to help inform strategic planning and decision-making.Anchored in environmental, economic and social considerations, the four TNS principles provideexplicit guidance on how to operate within the natural laws and principles, in order to successfullynavigate the pressures that the ecosystem and society face. The principles state that, in asustainable society, “nature is not subject to systematically increase concentrations of substancesextracted from the earths crust, concentrations of substances produced by society, degradation byphysical means and that people are not subject to conditions that undermine their ability to meettheir basic needs” (The Natural Step, n.d.).As previously stated, the mobile services industry is experiencing rapid growth and majortransformation in order to meet the demands of the growing population. People around the worldare becoming more dependent on mobile services and requiring more functionality from nextgeneration devices such as Smartphones and Tablets. The principles outlined in the TNSframework provide the industry with the tools to examine design and production factors such asmaterial selection, life cycle design, and waste reduction within which the industry can innovateand improve its performance. By applying TNS, the mobile services industry can craft a plan tobridge the gap between where it is today and where it would like to be as a sustainable industry.
    • Vision for a Better Mobile FutureA recommended vision for the industry is to create a sustainable, closed-loop mobile industry thatenables an interconnected, liberated, global community consisting of healthy, educated peoplewho have open access to affordable mobile services. This better mobile future consists of a worldwhere all people are more informed and connected to each other; empowering them to play alarger part in determining their own destinies and the destinies of their communities.Specific criteria and recommendations for generating progress towards this vision include: ● Increasing mobile penetration rates in developing countries. ● Increasing smart phone penetration rates. ● Increasing the availability and prevalence of socially beneficial applications such as those related to mobile banking, education, health, agriculture, and market information. ● Providing mobile phone and service pricing that is accessible in proportion to local income. ● Using market power and political coalitions to ensure that mobile services are not made unavailable to citizens by oppressive regimes during times of political activity or change. ● Educating customers about the beneficial services that mobile phones can offer in order to maximize positive impact and subscription to these services. ● Providing open feedback channels for customers to make suggestions for new products and services, and stimulate product innovation that aligns with what customers demand.A detailed metrics section, included towards the end of this paper, provides recommendations forspecific mobile industry goals, tracking, and evaluation.
    • Major Impacts Related to the IndustryMobile Industry Value ChainThe mobile services industry operates as a hub that delivers mobile services to consumers usingthe hardware and software. The inputs to the industry are in the form of energy and materials usedin the production of mobile devices as well as transmission infrastructure. The outputs from thedelivery of this service include positive impacts on the economy, health, and society as well assolid waste from the used and disposed hardware devices. Figure 7. Mobile Industry Value Chain Inputs and OutputsMajor Impacts of the IndustryThe major impacts related to the mobile services industry across this value chain can be evaluatedfrom a triple bottom line perspective and compared against the major trends identified above. Thisprovides a groundwork for developing performance metrics based on environmental, economic,and societal considerations. Beyond the standard issues and opportunities related to e-waste thatare most often explored in the mobile industry, there are also numerous benefits to productivity,connectivity, and culture that have resulted from the provision of mobile services.
    • Economic ImpactsBy bridging the digital divide, mobile technologies make it possible to deliver greater access toinformation and capital to millions of people in new markets, and in the process, generate newincome opportunities and increase economic development. Mobile service providers can play avital role in driving socioeconomic development in emerging markets by providing access to newfinancial services, such as mobile money transfer, as well as other forms of business services. Thisis why Thomas Friedman calls mobile technology “one of the top flatteners of our world, helping tobring more equality and opportunity to less fortunate people around the world” (Friedman, 2005). Figure 8. Mobile Banking Opportunities in Emerging Markets. (Gencer, 2011)In order to sustain growth, companies need to continue to monitor issues of affordability for mobileservices and access to cellular coverage. Currently, the average price of a handset in emergingmarkets is $58 USD, which is still a significant investment for those living on $2 a day. Yet industrymarket research indicates that despite the high cost, first-time low-income buyers are willing topurchase and use mobile phones. Mobile service providers can accelerate mobile phone adoptionif they develop alternative financing mechanisms to help the poor overcome the cost barrier.According to Menekse Gencer, an industry leader in mobile payment and mobile bankingstrategies, this represents an opportunity to gain 1.7 billion new customers in 2012 alone, which
    • can have an enormous impact on global GDP growth and equity (M. Gencer, personalcommunication, January 29, 2011).Environmental ImpactsThe largest environmental impacts of the industry are from handsets. The average lifespan of amobile handset is less than twelve months, and in Figure 9. Volume of Mobile Phone E-waste (EnviroSmart, 2010)the U.S. alone, over 140 million handsets end up inthe landfill each year (mobiThinking, 2011). Inaddition, the one billion handsets manufactured eachyear contribute nearly sixty million metric tons ofCO2, of which 95% is from manufacturing and 5%from use (Fat Knowledge, 2007). To address theseimpacts, mobile service providers can mandateDesign for Environment (DfE) principles in theirhandset guidelines—influencing manufacturers todesign handsets, chargers and other phone accessories for disassembly, reuse or recycling ratherthan for obsolescence. Companies can also collaborate on developing universal battery chargersthat are applicable across all handsets. Finally, mobile service providers can play a key role ininfluencing the industry to adopt a service-and-flow based business model whereby consumers“lease” phones; enabling complete take-back of phones and therefore a closed-loop life cycle.Another important factor with regards to the environmental impacts of mobile services is the energyuse associated with network operations. While the most significant CO2 emissions are related tothe manufacture of cell phones, the mobile industry can continue to reduce its emissions bydeploying energy-efficient technology throughout its global mobile networks. Moreover, companiescan increase their usage of renewable energy to power network base stations and towers,
    • particularly in the developing world where the energy infrastructure is still being developed. Thereare also opportunities to work with suppliers to reduce carbon emissions across the supply chain.One positive environmental impact of improved connectivity and communications is that it reducesthe need for business travel, and helps companies decrease fuel usage. In addition to achievingcarbon reductions, the adoption of mobile services in the workplace has resulted in travel costreductions and streamlined communications that enhance the productivity of employees(mobiThinking, 2011).Social ImpactsThe proliferation of mobile services is also changing the Figure 10. Texting and Driving Statistics (Virginia Tech Transportation Institute, 2009)cultural fabric of how people interact in completely new ways.However, like most disruptive technologies, there are twosides to the impact. One of the most visible negative impactsis the labor abuses at factories, such as what happened atthe Foxconn plant in China, where news of employeesuicides have prompted the industry to step up its supplychain oversight (Johnson, 2011). Mobile service providerscan wield a great deal of pressure on the supply chain byimplementing supply chain policies that ensure suppliers are complying with ethical laborstandards and human rights clauses, and protecting the health and safety of their workers.Companies can also institute a responsible sourcing policy that prevents the procurement of rawmaterials from conflict regions.Another negative effect of mobile use is stimulus overload, which can lead to impaired decisionmaking, derailed brain processing, attention span distractions and addictive behaviors (Begley &
    • Sharon, 2009). To underscore the social impact this can create, in the US alone, there were 5,870traffic deaths involving cell phone distractions in 2008, and over 16,000 people died in cell phonerelated automobile accidents between 2001 and 2008 (American Journal of Public Health, 2010).However, there are also many positive impacts that result from increased mobility. Mobile serviceproviders are uniquely positioned to offer the 90 percent of the population they reach with vitalsocial services in health and education, and expand access to financial services by enablingsecure forms of mobile payments. In terms of health solutions, mobile technology offers manyopportunities to improve the delivery and effectiveness of health services in rural areas—from textmessages for patient reminders and reporting of medical supplies and clinical trial data.The ability to connect, inform, and mobilize is also creating a surge in self-organized and managedcitizen activism. As recently displayed in the Middle East‟s democratic uprisings, mobile technologyis helping to empower citizens around the world. Mobile services providers need to recognize theimpact their products have on the larger society and take responsibility for keeping networks openin order to help drive a more transparent and connected world.MetricsTo achieve the vision of a more sustainable mobile industry, mobile service providers shouldmonitor their progress on indicators that span economic, environmental, and social criteria. Themetrics identified here include: penetration, sustainable development, access to handsets andbroadband, CO2 emissions, handset reuse, DfE, supply chain oversight, and access to education,health, and financial services. Details for the goals and measurement criteria for these metrics areoutlined in Figures 11 and 12.
    • Figure 11. Proposed Goals for the Mobile IndustryFigure 12. Progress on Goals to Date
    • Key Players and Best PracticesMany of the largest mobile services providers have made steps towards addressing sustainability,but even the leader still have room to grow in this area. Vodafone, the largest provider in Europe,Africa and the Middle East, is leading the industry with its integrated sustainability strategy; whileChina Mobile has committed to a range of both environmental and social initiatives. AT&T, thelargest provider in the United States, has just begun to implement sustainability practices within thelast few years, focused primarily around handset take-back and lifecycle management programs,However, it still ranks lower than other carriers on overall sustainability. Key practices from each ofthese players are described below.VodafoneVodafone is recognized as a sustainability leader in the industry. It ranked #11 out of all globalcompanies in the 2010 Newsweek Global Green Rankings. What makes Vodafone stand out fromthe competition is its comprehensive sustainability strategy, which is aimed at leveraging mobiletechnology to shape a more sustainable society particularly in the developing world. Aside frommaking progress on reducing its carbon emissions, Vodafone sees opportunity in leveragingsustainability challenges as a key stimulus for innovation within its business. With its broad reach inemerging economies in Africa, Asia and the Middle East, the company is developing services that“enable more efficient and effective healthcare; access to basic financial services to mobilepayment solutions, and machine-to-machine applications that can bring substantial carbon andenergy cost savings” (Vodafone Sustainability Report, 2010).One of the more unique aspects of Vodafone‟s Sustainability Strategy is the company‟s use of theUN Millennium Development Goals (MDGs) as a framework for focusing their efforts to bridge thedigital divide in emerging markets. Vodafone believes that improved access to communication can
    • be a springboard for alleviating poverty and enabling sustainable development. The company hasstarted to align the development of new products and social programs in emerging markets againstthese goals.Figure 13. Vodaphones Contribution to the U.N. Millennium Development Goals (Vodaphone, 2010)China MobileChina Mobile is the first mainland Chinese Company to be listed on the Dow Jones SustainabilityIndex. The company is committed to triple-bottom-line principles as well as active stakeholderengagement, as the company believes that „Responsibility Makes Perfection‟ (China Mobile, 2010).China Mobile serves more customers than any other mobile service provider in the world and has a
    • 60 percent market penetration rate. It is best known for its excellent services to underprivilegedpeople living in rural areas. The company has tirelessly sought to provide excellent information andcommunication services to those that would otherwise be at a disadvantage. Farmers are able toget up-to-date price information on crops and livestock and are able to buy and sell agriculturalproducts using China Mobile Services.The company is also renowned for its commitment to other disadvantaged groups such as disabledpeople. China Mobile provides special services to disabled people in Beijing and sponsored theParalympics in 2008. The company‟s mission is to use their mobile services to enrich people‟s livesand operate in harmony with society and the environment.China Mobile uses GRI reporting standards which track their „Green Action Plan‟, which includesenergy efficiency measures for their data storage facilities and implements green building designsfor all their new state owned buildings (China Mobile, 2010).AT&THistorically, AT&T has not been recognized in the industry as a leader in the sustainabilitymovement. However, over the last few years, they have made significant company-wide shifts inthe prioritization of sustainability initiatives. Today, AT&T is deeply engaged in environmentalsustainability efforts, and through their commitment, they have developed aggressive initiatives tohelp them become more energy efficient and to engage their key stakeholders in helping thecompany minimize their environmental impact.AT&T‟s comprehensive recycling programs and sustainable handset design initiatives are whatdistinguish the company from its competitors. While AT&T does not produce mobile phones, they
    • are instrumental in driving the sustainable design, packaging, and materials used in handsets andare in the forefront in handset lifecycle management from procurement to take-back. Rather thanonly focusing on offering a few sustainable devices, AT&T is taking a broad approach toincorporate elements of sustainability into all of its products. To help further this initiative, they nowrequire mobile phone manufacturers to abide by their updated packaging guidelines aimed atreducing waste and the environmental impact. As a result of these efforts, AT&T was ranked #1 inGreen Carrier Matrix in 2009 and top ten in IDCs mobile operators green ranking in 2011(“Environmental Leadership Awards & Honors”, 2011).Figure 14. AT&Ts Handset Guidelines (“Environmental Leadership Awards & Honors | AT&TCorporate Responsibility,” 2011)Other Mobile Services Companies and OrganizationsOther companies add to the mobile services landscape by providing software and services that areaccessed through mobile technology, and the expansion of these services has the potential tocontribute to the sustainability of the industry at large. Will Hunsinger, CEO of Evri, a technology
    • company that develops content discovery software, recently shifted the company‟s strategy toinclude a significant mobile component in its product line. This year, with more than 85 percent ofthe handsets shipped globally expected to include a browser and, in mature markets, new andinnovative mobile web technologies are continuing to encourage enterprises to develop mobileapps. Will believes that a heavy mobile strategy will be part of almost every enterprises portfolio by2012 (W. Hunsinger, personal communication, May, 2011). At Mobile Disruption, a mobileconference in San Francisco, the top influencers and experts in the mobile industry such asTwitter, Groupon and Foursquare discussed the trends and opportunities in the mobilemarketplace. A significant topic of conversation was anchored around enhanced locationawareness technologies and its vast implications globally. By the end of 2011, Michael Shim, VP ofMobile at Groupon, said that more than 75 percent of the devices shipped to mature markets wouldinclude GPS technology, which could create significant business opportunities in emergingmarkets. He referenced a few interesting use cases like weather warnings and languagetranslation that could be enabled by location information from a mobile device. However, accordingto Shim, Groupon is delicately and methodically strategizing on the best way to expand theirpresence in emerging markets.Sustainability Reports and ResultsThe competitive matrix below evaluates the top mobile service providers, from different regions ofthe world, on key sustainability activities and metrics. The information was gathered from the mostrecent company CSR reports.
    • Figure 15. CSR Performance for Top Mobile Service Providers Vodafone AT&T China Mobile ORGANIZATIONAL PROFILE Markets Europe, Africa & Central Europe, Services mainland China and Hong United States served and Asia Pacific & Middle East. Kong. Revenue $67.010B (USD) $49B (USD) $74.725B (USD) (2010) Subscribers 341 million mobile customers 300 million mobile subscribers 600 million subscribers Primary Mobile network for 2G & 3G, Wired and wireless voice and data, Mostly 2G service and phones and brands, released 66 handset models & 4 broadband Internet, TV and online banking and information products and netbooks, fixed broadband services messaging services provider services Workforce 84,900 266,590 145,954 SUSTAINABILITY STRATEGY Key issues divided into 3 areas: Environmental sustainability Network: energy use & climate initiatives based on four tenants: 1) change, e-waste, health & safety, Minimizing environmental impact Offer agricultural information community consultation for network through development of services to gives customers access rollout, mobile phone masts & environmentally friendly products, to market prices. Allows for online health. Products & services: access 2) Handset reuse & recycling money transfer between employees to communications for those who program, 3) Paperless billing, 4) and employers, wire transfers, bank Sustainability are currently excluded, socio- ICT products that enable customers withdrawals and mobile payments. Issues economic impact of mobile, content to increase energy efficiency and China mobile offers special standards to protect youth, privacy reduce carbon emissions. In 2009, services to Beijing paralympics. of location-based services. Brand AT&T & Qualcomm launched The heart card gives discounts on presence & retail: responsible ForHealth, using mobile call times and subscriptions to all advertising, handset reuse and technologies and smart networks to disabled people. recycling, clear/ transparent pricing, improve the quality of health-related customer education on services to consumers. sustainability issues. 1) Set handset guidelines for its 1) Ensure Vodafone and our manufacturers that include suppliers have an ethical supply standards on recyclability, restricted chain, 2) Deliver accessible substances, conflict minerals, and products and services, 3) Reduce energy-efficient universal charging, our CO2 emissions by 50% by 2) Incorporate supplier GHG 2020, 4) Be recognized as having emissions into its calculations, 3) China Mobiles sustainability the most customer-relevant Reduce electricity consumption by strategy is based around installing environmental sustainability 17% as compared with year 2010, responsibility for the environment Sustainability initiatives in our industry, 5) 4) Deploy 15,000 alternative-fuel and society in all their stakeholders. Strategy Establish joint CO2 reduction vehicles (AFVs) through 2018, 5) They are most focused on the strategies with key suppliers, 6) Purchase wind power for 10% of social benefit that the company can Build e-waste management electricity consumption in Austin, provide to the Chinese people living capacity in key emerging markets, Texas facilities, 6) Recycle 95% of in rural areas. 7) Deliver innovative products / all materials through its reclamation services recognized as contributing process, 7) Grow its e-waste to the Millennium Development management capacity throughout Goals, 8) Provide 10 million carbon- the supply chain, 8) Deliver reducing M2M connections. innovative environmentally friendly products. GOVERANCE CEO Vittorio Colao engaged on Chief Sustainability Officer Highest sustainability. The Group Corporate established a governance model governance Responsibility Director presents capable of integrating sustainability CEO is dedicated to sustainability body for four times to the Executive across the organization which sustainability Committee and once to the Board tethers its mandate to the of Directors each year. Chairman‟s office World Wide Web Foundation, International Communications China Mobile hold frequent Chief Sustainability Officer initiated Technology (ICT), GSMA, stakeholder engagement meetings Stakeholder stakeholder engagement to identify Corporate Leaders Group on with Customers, employees, engagement materially relevant issues to AT&T‟s Climate Change, Global e- Suppliers and Shareholders to sustainability strategy. Sustainability Initiative, CSR discuss sustainability issues. Europe, WBSCD
    • Vodafone AT&T China MobileENVIRONMENTAL Total CO2-e emissions (all sources) for 2010: 1.37 million tons. Total GHG emissions for 2010: China mobile are committed toGHG Total net CO2 emissions have 8.97 million tons. There is no set green building designs and energyEmissions decreased by 9% against the target to reduce its emissions. efficient data servers. 2006/07 baseline. The goal is a 50% reduction by 2020. Reducing GHG emissions, focusing on improving its fleet efficiencies by purchasing 15,000 alternative-fuel Reducing the carbon footprint of vehicles through 2018. their networks, which account for Implementing energy saving more than 80% of the CO2. solutions in its wireless network Working with Tier 1 suppliers to such as replacing controllers, using reduce GHG emissions. LED bulbs and repurposing Collaborating with the European equipment. Reducing energy use at ICT for Energy Efficiency (ICT4EE) data centers. Taking part in industry China Mobile has focused itsEfforts to to shape climate policies for the & government collaboration to attention on providing keymitigate industry. Aims to be a recognized promote The Green Grid and chairs information services to rural areas.environmental "green" brand in 75% of developed the Telecommunications Energy They currently provide informationimpact of markets by 2012. Encouraging Efficiency committee, which to farmers on crop prices and allowproducts and customers to reduce impacts during monitors best practices for energy them to buy agricultural equipmentservices use and end-of-life: handset efficient telecom equipment. through their service. recycling, fewer phone upgrades, Pledged to purchase 10% wind universal charger, solar charger, energy for its Texas locations and applying environmental design commissioned 3 solar systems in principles to handset design, e- 2010. Reclaims network resources billing, reduced packaging, and such as copper wire, mandates videoconferencing and home environmental design principles in working solutions. its handset guidelines, and encourages employees to get involved in sustainability initiatives.HUMAN RIGHTS, LABOR & SOCIETY Vodafones Code of Conduct sets out the companys Business Principles, which cover ethical issues including: bribery and corruption, conflicts of interest, data AT&T has an employee protection, environment, health and engagement program that provides safety, human rights, political sustainability education via onlineEmployment contributions and lobbying and videos and other content distributed China mobile have one of the bestpolicies & transparency. They are also on its sustainability focused Intranet employee policies in mainlandprograms working to extend these principles site. They also have a volunteer China to their 45,000 suppliers through program called AT&T Cares and their Code of Ethical Purchasing hold yearly awards to employees and Supplier Assessments. They based on their sustainability efforts. also encourage gender and cultural diversity, and provide employees with training the development opportunities. Channel 150 million euros of social investment through Vodafone Foundation and its 27 local foundations since 2002. In 2010, they contributed 25 million euros. "World of Difference" program has provided 7 million euros in funding In 2010, AT&T contributed more In 2010 China mobile built 175Community to 1,500 skilled people with a than $148 million through libraries in rural areas and does agiving passion for charity work in corporate, employee and AT&T substantial amount of charity workprograms developing countries. "Red Alert" is foundation giving programs. for under privileged people. an emergency SMS fundraising program that provides disaster relief. "Mobiles for Good" funds projects that use mobile technology to address the worlds most pressing humanitarian issues.
    • Vodafone AT&T China Mobile AT&T provides products and services that help teachers and students achieve some of the Extending access to educational objectives outlined in communications to customers in Other social- the American Recovery and Sponsor Paralympics and provides emerging markets. Offering based Reinvestment Act of 2009 (ARRA). special needs for disabled people applications such as mobile money programs AT&T is also involved in One in Beijing. transfer for people without bank Economy and made a $36 million accounts and m-health solutions. commitment to fund broadband access to undeserved communities in the U.S. SUSTAINABILITY AWARDS & RECOGNITION Corporate Knights Global 100 List Newsweek Global Green Rankings (2010) #8, Newsweek Global Newsweek Global Green Rankings (2010): #57, IDC Top Green Mobile Green Rankings (2010): #11, IDC (2010): #35; China mobile Green Operators, Tomorrows Value Top Green Mobile Operators, becomes first company from Rankings Rating (2009) #19, ABI Research Tomorrows Value Rating (2009) mainland China to be listed on Telecom Top 10 (2009) #1 in N. #1, ABI Research Telecom Top 10 Dow Jones sustainability index. America, (2009) #3 in EuropeConclusionThe mobile services industry has deep impacts on the environment, society, and the economy, andthis paper offered a vision for a better mobile future in these areas. In order to manage growthwisely, the industry should embrace the opportunities for positive impact through the delivery ofservices, while taking care to minimize impacts through its supply chain and handsets. Allcompanies in the mobile services industry should recognize that sustainability is a key componentof business innovation. Based on the industry players explored, the industry is well positioned tocapitalize on the potential for positive impacts in connectivity, society and economy. However, inorder to achieve maximum performance in the areas of the metrics identified companies need tocommit to a stronger portfolio of sustainability measures.
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