The World Is Going 'Green' And So Should PC Makers, Says Gartner - InformationWeek
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11/29/2006
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The World Is Going 'Green' And So Should PC Makers, Says Gartner

Gartner tells hardware and electronics manufacturers to plan ahead for ever-growing green laws that could derail production.

Computer and electronics manufacturers need to invest in research and development that will align their upcoming products with "green" regulations and laws that are bound to be coming down the road, warns Gartner analysts.

Anticipating new laws and an increase in green concerns will help companies avoid production problems as more countries expand their litany of rules and regulations to protect the environment, said Meike Escherich, a principal research analyst at Gartner, in a written report.

"Failure to transition products on time can lead to high inventories and dramatic price cuts, similar to the effect we saw in Western Europe as the RoHS [Restriction of Hazardous Substances directive] came into effect," said Escherich. "Non-compliant components will be gradually removed from the global supply chain and force manufacturers to discontinue products that contain them."

This past summer, the European Union's RoHS directive went into effect. It mandates that manufacturers whose products contain certain hazardous substances face removal from the market and potential heavy fines. In January, the Waste of Electrical and Electronic Equipment directive will go into effect in Europe, imposing strict regulations on the way electrical equipment can be disposed.

The European regulations are just the first of many, according to Gartner. China passed its own, more stringent version of RoHS, and that regulation is set to go into effect in March. Japan has had a similar law in place since 2000 and recently passed amendments to it. Gartner analysts expect South Korea, Australia, China, and California to implement further green legislation.

According to the analyst firm, only 43% of the PCs currently installed worldwide are affected by RoHS type regulations. That has caused some manufacturers that ship only into the United States, the Middle East, and some other non-European countries to disregard the regulations.

That's not a wise move, warned Gartner. Green regulations will have a worldwide impact as component manufacturers can no longer justify separate production lines for 'green and non-green parts, the report said.

"Not far from now, non-green parts will be assigned end-of-life status and green legislation will come to impact every single PC manufacturer," said Escherich in a statement. "The worldwide market should expect to see longer lead times, part shortages, and rising prices for non-compliant parts over the next two years."

Escherich also advised manufacturers to make sure they have an adequate supply of required parts and systems during the transition period.

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