Silicon Valley Watcher - Former FT journalist Tom Foremski reporting from the intersection of technology and media

Who Will Be The First "Fair Trade" Tech Company? It's The New "Green"...

Posted by Tom Foremski - May 28, 2010

There's a tremendous opportunity waiting to be grabbed. There's a Wikipedia page waiting to be written.

"The first Fair Trade tech company was ..."

I'm certain that the Fair Trade concept will be applied to electronics, and it's just a matter of when that will happen. I'm convinced it will happen not because it's a good idea but that it's a potentially profitable idea.

Let me explain my thinking. Our digital gadgets and gizmos are becoming very cheap, almost disposable - yet the working conditions for millions of workers in the global electronics industries are deplorable. Even though they often work in bunny suits, in super clean, well lighted work places, those jobs are highly stressful and often unhealthy.

Lets not forgot that those bright, sanitized work places, those clean work clothes, and filtered air conditioning, is not for the workers, it's to protect the electronics from the humans. The wages are poor and the work is grueling.

Fair Trade electronics could help tens of millions of people around the world without making much difference to our wallets. We could easily alleviate a lot of suffering without much suffering on our part, we could afford to pay a bit extra.

Noble goals are important but what will drive the growth of Fair Trade electronics is that it will be an excellent way to make money. It's a great way for companies to differentiate themselves in the market place.

Consider this: All technology products trend towards becoming commoditized - that's just how things work. How do companies fight commoditization? It's done through differentiation.

- Companies such as Apple do it through design. Take a commodity product, say an MP3 music player, and apply a great design. Design drives sales and it is a high profit value add.

- A lot of computer companies these days proclaim how green they are, how eco aware they are, and how their products use less energy, carbon, etc. "Green" drives sales and it's a high profit value-add.

- Fair Trade electronics is another way companies will be able to differentiate themselves from competitors. Fair Trade will drive sales and it is a high profit value add.

Yes, companies will be able to make money out of Fair Trade electronics and make a difference in the world- it's one of the wonders of capitalism.

Fair Trade applied to the electronics industry will also be incredibly transformative because the supply chains are huge.

Think of a laptop and how many companies were involved in the sourcing of the components of a hard drive, the motherboard, making the chips, the glass for the screen, the plastic for the keyboard, the springs in the keys, the capacitors, the resistors, and on and on...

To make a Fair Trade laptop would require hundreds if not thousands of companies in the supply chain to have Fair Trade certified work places. So, if a company such as Dell or HP were able to build just one electronics product, a Fair Trade laptop, it would revolutionize a massive sector of the world's electronics industry.

And once a supplier has a Fair Trade manufacturing facility it can then also supply Fair Trade components for a vast array of other Fair Trade electronics products.

The first Fair Trade tech company will revolutionize the entire industry. Who will it be?


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