The GSMA’s Product Director, Shamit Bhat, and Daniel Jones (Shields) provide an overview of how industry circularity initiatives are helping address equipment supply chain challenges. They also explain how operators can accelerate towards their net zero targets at the same time as reaching their financial ones.
This is the first in a seven-part series on the many business benefits of circularity. Future articles will elaborate further on GSMA initiatives to reduce embodied carbon emissions and Scope 3 emissions, drive monetisation and savings through pre-owned network assets and responsible recycling, as well as facilitating an inclusive circular economy ecosystem.
Telco net zero ambitions
In 2019, the GSMA board set an ambitious target of achieving net zero as an industry by 2050. More than 20% of the telecom sector committed to this target by 2021, leading to the United Nations recognising telcos as a breakthrough sector in the space. By 2022 more than 67 operators representing 66% of the industry by number of connections, signed up to report towards the Carbon Disclosure Project (CDP). By 2023, more than 64 operators had committed to near-term sustainability targets – all this despite COVID. In 2024, the industry has focused on capacity building, energy efficiency benchmarking, closing the climate gap, Mobile Net Zero 2024, renewable advocacy and Scope 3 data collection initiatives.
Yet, we will never reach our net zero targets if one critical aspect is not addressed. The linear supply chain.
Why is success predicated on transforming the linear supply chain?
To achieve net zero targets, operators must reduce their Scope 1, Scope 2, and Scope 3 emissions. Operators control Scope 1 and Scope 2 emissions as these come through their own operations. However, Scope 3 are indirect emissions posing a huge challenge. 75% of the industry’s carbon emissions come from telco supply chains, that is, from these Scope 31 emissions.
Running optimised networks requires efficient supply chains
Due to a fast-changing technological landscape and competitive pressures, operators have faced financial burdens over the years, particularly with revenue stagnation and much needed investments into new technology, such as 5G and VolTE. Moreover, regulatory pressures or government policy changes might introduce additional burdens on managing optimised networks. As a result, costs are increasing, and profitability is reduced.
Capacity building and running optimum networks are the critical jobs of the network planning manager, ably supported by network engineering and procurement teams in ensuring the supply and availability of the right parts, equipment and network assets at the right time. This again is highly dependent on having well-oiled supply-chain machinery.
Double trouble: run optimised networks while managing finances and Scope 3 emissions
To manage this twin-challenge, operators will have to make several adjustments, particularly in their supply chain. It will need to transition from a cradle to grave linear economy to a cradle-to-cradle circular economy model. Operators will have to play a critical role in this transformation where equipment reuse, remaking and recycling is central to its business model.
A circular economy-based supply chain will deliver new revenue and savings opportunities. All while contributing to a reduction in operators’ embodied carbon or Scope 3 emissions.
What is the GSMA doing to address these dual challenges?
GSMA Equipment Marketplace plays a pivotal role in solving these challenges. It’s a digital platform that helps operators buy, reuse, resell and recycle pre-owned network equipment. Firstly, the platform connects sellers with buyers of pre-owned network assets. Secondly, it enables operational fulfilment globally – you can trade pre-owned network equipment from anywhere in the world and recycle equipment that has reached end of life. This ensures that operators focus on their core competency of building networks for best-in-class customer experience. The GSMA’s partner, Shields, runs this cradle-to-cradle circular supply chain model on their behalf. Unlocking environmental and financial benefits, by maximising on reverse network streams.
How does it work?
How many businesses are using GSMA Equipment Marketplace?
1500 users across operator, manufacturer, agent and vendor partners have access to the platform today, with Vodafone group being one of the early adopters and biggest beneficiaries. These users continue to benefit from the quality, speed and efficiency the platform delivers to help all ecosystem players reach their financial and environmental targets faster.
How to engage with the GSMA?
Any member operator, manufacturer or ecosystem player is encouraged to get in touch to learn further. Read more about GSMA Equipment Marketplace here and contact us here.
1 Source: GSMA analysis based on CDP (2023) and corporate sustainability reports