This year in China smartphone manufacturers have started using memory chips extracted from old iPhones and other devices for installation in new models because of a components shortage.
Reasons for turning to the secondary market
Due to the shortage of memory chips their price has risen, and some companies are looking for the required components on the secondary market. The price of a secondary chip reaches $75, which makes selling extracted chips a profitable business.
In Shenzhen a market has already formed where used components are sold separately from device casings. Instead of buying new chips, manufacturers turn to disassembling old phones to obtain the needed parts.
Examples and the economics of device disassembly
One of the e-waste recycling companies in March purchased about 1,000 faulty smartphones and was able to extract working components from more than 600 of them. A faulty smartphone in China can be bought for approximately $15, and if the memory chip sells for more, the operation becomes economically attractive.
Extracted memory chips are typically used in low-cost models rather than in flagship devices. The piece also notes that when new chips appear on the market prices on the secondary market may fall, making this business less profitable.
