Robert Triggs / Android Authority
HMD Global announced three new smartphones and one tablet at IFA 2022: Nokia X30 5G, Nokia G60 5G, G31 and T21 tablet. The four products range from mid-range to extremely budget-friendly price points. All good handsets, but the more interesting one was HMD’s eco-subscription model called the Circular. We sat down with HMD Global Head of Product Proposition Adam Ferguson to find out more about it.
At its basic level, Circular will get you a smartphone for a monthly fee, which ranges from £10 to £25 (~$12-$29) depending on the model.. In addition, it takes HMD Once you’re done with the phone, you can take charge of the phone, cycle it back through the program, donate it to charity, or completely recycle it. The results of the kick will be used for good causes such as planting trees or providing mobile communication to disadvantaged areas. The longer you keep the phone, the higher the rewards. It’s a new way to pay for your phone, especially if these reasons speak to your personal concerns.
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“People buy a Nokia phone because they want to keep it for a long time and they want it to last,” Adam begins, before explaining that the circular comes from wanting to reward customers “by doing something they want to do anyway.” ” With a focus on Nokia brand sustainability and multi-year eco-partnerships with the Ecovadis and Ecology brands, Circular tries to combine its commitment to sustainability with what HMD sees as growing consumer demand and potential new subscription models.
Circular redefines the smartphone buying paradigm and puts sustainability at the core.
While the appeal is clear to the ultra-eccentric, it has its work cut out for it to prove that circular subscriptions and rewards are the business model of the future, let alone successfully address the industry’s growing e-waste problem.
Saving the planet is not cheap
Robert Triggs / Android Authority
For example, circulars charge a premium compared to outright purchases. Picking up the Nokia X30 5G for €30 (~$29) per month and keeping the phone for the full three-year upgrade cycle will cost €1,080 (~$1,075) for a phone that retails for €529 (~$457). This is a tough pill to swallow for those who demand high technology for their money and traditional payment models that their customers are familiar with, especially since there is no real way of ownership for the product.
However, it is not fair to look at the cost in terms of hardware investment. “If something goes wrong, just call and it’ll be replaced, we’ll wait for you,” explains Adam. HMD will replace a lost or broken handset before asking twice, even on its cheaper models. “We’re trying to offer as big a guarantee as we can in our region,” he explains. In comparison, other manufacturer insurance policies, such as AppleCare, cost hundreds of thousands more, with known deductibles to pay if you need the service.
Read more: What are your options for phone insurance?
Although circular warranty is good for peace of mind, it is not a complete solution for using phones as much as possible. For that, consumers want easy access to affordable repairs, or better yet, the right to repair devices themselves, but those reasons simply don’t fit well with a subscription model. A non-removable battery doesn’t hurt either. HMD says it may have more to announce on that front next year. Here is hope.
Extensive warranties alone will not solve the growing need to keep equipment running for a long time.
“You might be thinking of keeping a cell phone for three years… but what if you can’t afford that?” Adam explained that Circular is also a flexible subscription. After the first three months, subscribers are free to leave, upgrade or downgrade their handsets. Adam continued, “Obviously we want them to keep the single phone longer, so that’s what the incentive is for. But if they want to change, they have to be able to do that.
Circular offers subscribers a level of freedom that is hard to find elsewhere. If we can’t have a proper right to repair, maybe a right to return is the next best thing? Safe in the knowledge that equipment we no longer need will be given a new lease of life or put to good use.
Still, this is a major drawback of the circular model compared to traditional subscriptions. You will never own the device. You can’t trade, sell or transfer to a friend when it’s time to upgrade. You’re investing in insurance, “seed” plans, and the promise of recycling instead of your own hardware. However, that gives HMD a chance to guarantee what happens to the device after you hand it back, since it technically owns it.
The circular covers subscribers for insurance and ecological risks.
While other manufacturers have return and trade-in plans, they don’t always guarantee what will happen to the device. “If it’s at the end of its life, we guarantee it’s going to be recycled,” Adam said, “if it’s not and it might be useful somewhere else, it goes and does that. Reusing and recycling mobile phones is an important part of solving the e-waste problem and an integral part of the circular model. Of course, there are many non-registration methods that allow you to donate or recycle that old cell phone instead.
Updates and longevity go hand in hand
Robert Triggs / Android Authority
Then there is of course the cause of updates. Three years of OS updates and security patches for the X, G and L series are acceptable, but not the best in the business. But just two years on lower-end C models is well below what’s needed for safe long-term use, making the eco-conscious angle somewhat odd. HMD admits that improvements are necessary but hasn’t had the best track record over time. In fact, the company – based on its internal data – doesn’t seem to agree that upgrades will hinder users from using their devices in the long run.
“People carry devices for a variety of reasons … some carry an X-series device for the reasons we talk about in the circular,” Adams said. It suggests that customers can stick with lower-end C series devices to avoid the cost of buying another device, especially in different markets. While true, this is an abdication of the long-term responsibility of keeping customers safe. There’s an obvious limit to the upgrade resources HMD can throw at its budget products, but the long-term revenue generated by the subscription model should allow the company to go that far.
Security updates are a big part of long term support and HMD could do a little better.
Updates aside, HMD Global’s eco-conscious subscription model feels like a solid start, especially given its increasingly popular but relatively lightweight eco claims, like ditching paper packaging and boxed chargers. Still, Circular is a very different way of thinking about smartphone ownership, or the lack thereof. It won’t suit power users or thrifty customers, and HMD subscriptions certainly don’t fit well with the right-to-repair goals. Instead, it’s for those after a simple end-to-end option that includes an extensive warranty, addresses some sustainability issues, and gives something back to good causes.
“We tried to keep the customers and their needs at the forefront,” says Adam. “This is a new way to buy phones, the devices can be returned and it significantly reduces waste. It will make a noticeable difference in the long term. Time will tell if HMD is on to something here.”