Only 44 percent of replaced PCs are being reused, despite global demand outweighing supply, says Gartner. 197 million PCs were retired in 2007. One in five recycled, “secondary market,” computers ends up in an emerging market Gartner defines a secondary-market PC as one that has been used for three months or more before being “passed on to a secondary fate.” Recycled computers represent perhaps 20% of PCs of computers currently in use, writes ars technica’s Joel Hruska. In a June report, Gartner estimated that 35 million PCs, instead of being recycled, will be dumped into landfills this year.

Business opportunities are good for the resale market, Gartner says. The profit margin on a three-year-old recycled PC is between $10 and $50, and can be better than for new PCs.

Inhibiting resale are transportation costs, import tariffs, and environmental legislation, as well as product quality, lowering prices for new PCs, and a market preference for notebooks and good specs. Netbooks will also increasingly compete with recycled PCs.

Software piracy is a big part of the recycled-PC business. “Branded PCs are particularly sought after because they may still display the original software license stickers, which provide some defense if checks into the authenticity of the software are made.”

Demand for recycled computers is greatest in the Middle East, Africa, and the Asia/Pacific region, especially China. The biggest exporting regions are North America, Western Europe, Japan, and Australia.

By Mark Alvarez