Apple recently released its third quarter fiscal results showing that overall profits are down but sales of iPhones are up by 20 per cent.
Clearly smartphones are selling well. So well, in fact, that Apple, who currently are responsible for 17 per cent of the worldwide smartphone market, are considering releasing a cheaper version of the iPhone, to capture a different segment of the market.
What is involved in making a cheaper phone? The technology reports will give you the specification differences – screen sizes, camera pixels and processor speed. We can compare features on a Nokia Lumia with a Samsung Galaxy with relative ease – this isn’t just an Apple thing.
What of the human cost in making a smartphone? This isn’t covered in the specifications, and yet is a very real issue for people involved somehow in the production of a smartphone, laptop computer or games console. People live and work in terrible conditions and even die to make our latest gadget a bit faster and thinner. Is this what we are signing up to when we buy new electronic goods? How can you tell what happens behind the wall of glossy marketing?
For example, did you know that a small portion of the $400 you just spent on a smartphone could be funding rebel guns in the Democratic Republic of Congo (Congo)? New research underway at the University of Sydney is showing new ways to link the human impacts of production with consumption.
The Congo suffers from its abundance and its vastness. From trade in rubber and ivory in the 1800s to the three Ts of the technological age – tantalum, tin, tungsten – as well as gold, diamonds and timber, the people of the Congo have rarely had their lives enriched by the resources of their country. We all know the story of blood diamonds from Sierra Leone. Less is known about the story of coltan, a surface deposit mined in the Congo.
In a long supply chain coltan gets processed into tantalum which is used in lightweight capacitors for electronic goods as well as in alloys, armaments, lenses, cutting tools and medical devices. Lightweight capacitors are one of the reasons that electronic goods such as phones and computers have been able to become so small and portable. When tantalum is mined in countries such as Australia or Canada, labour and conditions are controlled through corporation policy and legislation. However in the Congo mining is usually artisanal – anyone with a shovel can have a go at digging up the earth to find some black gold – and the conditions can be terrible.
Tantalum isn’t one of the 17 chemical elements defined as a rare earth elements (pdf) by the International Union of Pure and Applied Chemistry (IUPAC) but has many similarities when considering its role in the supply chain, such as dispersal of sources, low abundance combined with high demand, bottle neck controls in the markets, and environmental destruction in mining and processing the mineral. Not all of the world’s supply of tantalum comes from the Congo as coltan, nor is all tantalum associated with death and war.
The use of coltan to make capacitors for electronic goods becomes a problem when the sale of coltan funds a civil war and the social impact on the local population includes death, mutilation, rape, child soldiers and high mortality from treatable diseases due to the general breakdown of society.
A new study at the University of Sydney has used economic modelling to follow the supply chain of coltan in 2000, tracing it from artisanal mining in the DRC, across porous borders to Rwanda, through intermediate ports for processing and then to final consumers of electronic goods (and cars and medical devices) throughout the world. (Read about the study here (pdf).)The novelty of this approach is that it uses economic data, based on the System of National Accounts (the data used to develop statistics such as GDP) in the form of Multi-Regional Input Output Analysis (MRIO) to associate deaths in the Congo with final consumption. Estimates of deaths from the African Civil War during this time range from 2.5 million up to 9 million.
We know that the sale of coltan in the DRC funded the civil war. We know, for example, that in 2000 coltan was worth more than diamonds or gold. One rebel warlord famously told a US journalist that in 2000 coltan delivered US $1million per month, whereas diamonds only brought in US$200 000. And in 2000, in the middle of the dot com boom with new laptops and game consoles being produced at a rapid rate, that is most likely where the profits of the sale of coltan were channelled.
The study uses the Eora MRIO database developed at the University of Sydney to associate an estimated two million deaths in 2000 in the Congo with hypothetical final consumption in countries including as the USA, Germany and China. (The results of this study are available and papers have been drafted but not published as yet.) This study shows that we could quantify the social or environmental impact of the goods we use, and utilise this information to inform decision making just as much as technical specifications do.
Skip forward to 2013 and the production and supply of electronic goods still have a high human toll. Impacts range from worker deaths in China in factories such as Foxconn due to unsafe use of chemicals or excessively long work hours, to e-waste stockpiles leaking chemical cocktails in the third world. New sources of tantalum are emerging, such as in Colombia and Venezuela, which are again being linked to the funding of rebel groups and war.
Several schemes have been set up to improve supply chain transparency and certify conflict free minerals but most have failed due to the complexity of the supply chains, the number of parties involved, and our love of cheap goods. However a social enterprise called Fairphone is now offering the first conflict free smartphone on the market (sadly EU and US only at this stage), with a tightly controlled supply chain using conflict free resources from the Congo and ensuring good working conditions at their factory. The first production batch of Fairphones was primarily funded through crowd sourcing and in that seems to be the key to equity in the electronics supply chain – consumer action.
People need to take more responsibility for what they purchase. Movements such as Walk Free are calling on consumers to lobby big business to end modern slavery in the supply chain. One of their recent campaigns calls on Nintendo to source conflict free minerals. Ask your retailer some searching questions about the providence of your products, and in turn ask the same of your brand name producers. The more times we ask, the more producers have to take our concerns seriously.