Tech Customers Balk at Cost of Going Green

By Astrid Wendlandt, Reuters  |  Posted 05-21-2007

PARIS (Reuters) - Customers are not yet ready to pay extra for green products in spite of growing concern for the environment, technology, media and telecoms executives told an industry summit this week.

Ideas are multiplying for ways to save energy, increase recycling and use more environmentally friendly materials, but such measures could not be implemented fully unless consumers accepted at least some of the cost, the executives said.

"If the individual is not willing to pay a little more for the environment, don't expect the industry to do it," said Russell Ellwanger, chief executive of Israeli chip maker Tower Semiconductor.

"Industry has a responsibility but the one who needs to be responsible is the individual," Ellwanger told the Reuters Global Technology, Telecoms and Media Summit in Paris.

The impact of such companies on the environment is less visible than that of heavier industries, such as oil and gas producers or car manufacturers, but they are big consumers of energy and harmful materials as well.

Environmental issues have come under the spotlight as a growing number of scientists defend the idea that humans are responsible for climate change.

"People start realizing that this not just something to do to be hip but that it is absolutely necessary," said Barbara Schaedler, chief marketing officer of Fujitsu-Siemens Computers -- which makes preserving the environment part of the brand promise of Europe's leading personal computer maker.

Some executives noted how quickly the environment had emerged as a top concern and they were being asked increasingly what they planned to do about it.

"I had never been asked that question until three months ago. This is the second time in the last week," said Miles Flint, President of phone maker Sony Ericsson. "It is clearly becoming more of an issue on people's agendas."

NO ECO-PHONES YET

But Sony Ericsson is not planning a radical move.

"I don't think you'll see us coming to market with an eco-phone in a hurry," Flint said.

He said the company would continue to remove hazardous materials from handsets and increase recycling, but unlike Fujitsu Siemens would not make use of those initiatives as marketing tools.

"You've got to be quite careful about saying this is an ecologically sound product, unless you can really sustain that," he said.

Fujitsu Siemens, a joint-venture between Fujitsu of Japan and German industrial group Siemens, said 98 percent of materials were treated for recycling, re-use and energy recovery. These include cathode ray tubes and mixed plastics from business computers, servers and cash dispensers.

However, it admitted that 100 percent recycling was probably "some years out" and many elements could not be re-used.

Other technology companies such as Tower Semiconductor said power consumption was their main environmental focus.

"The more we reduce the amount of energy we use (for manufacturing), the more ecologically friendly we are," chief executive Ellwanger said. "The ability to reduce consumption drives innovation."

Tower, which makes chips in Israel, also filters water used to cool the chip manufacturing process so it can be re-used for irrigation.

Some less resource-hungry companies such as media groups said flying -- a major source of carbon emission -- could be reduced to help protect the environment. But it was unlikely to happen overnight.

"It will be some time before a buyer says I will not go meet my supplier," said David Levin, chief executive of United Business Media, which runs exhibitions around the world.

He did say UBM was thinking about buying carbon credits to offset emissions from travel by employees.