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The “Client” operates a large LTE wireless communications network that included 2G and 3G infrastructure. In addition, the Customer provides reliable wireless communications service, including mobile phones, to a wide range of businesses and public sector agencies that are critical to our national infrastructure.

The Challenge

With an aging analog network, the client desired to implement a new digital wireless communications network for its entire coverage area. The client did not have an in-house resource to responsibly dispose of the 1,000,000 pounds of electronic equipment and lead acid batteries coming from 84 unique collection sites. In addition to the equipment from over 1200 individual towers, the project also included 25,000 square of warehoused assets, administrative, and office equipment, and various remote locations being decommissioned simultaneously. The client would require forward and reverse logistics, IT Asset Disposition (ITAD) services and end of life recycling solutions that could help offset costs.

The strategy

With an established vendor relationship already in place, the client once again turned to Advanced Technology Recycling (ATR) who provided an expert project manager with extensive logistics and ITAD experience.  The objective was to leverage ATRs extensive infrastructure of technicians, drivers, resale specialists, commodity sorters and buyers, in a coordinated effort to seamlessly remove and process decommissioned assets in the most cost effective means possible.

The Outcome

The client was able to responsibly dispose of over 1,000,000 million pounds of data bearing electronics and lead acid batteries while generating $100,000.00 in eCommodity revenue.  The project initiated over 165 individual pickups that utilized ATR’s expansive fleet of vehicles, forklifts, remote shredders, and leased cranes.

The following quote is an excerpt from a glowing review sent upon successful completion.

Without a doubt, this project has been an impressive display of the incredible work force at ATR.  I know that there are many people at ATR that have made this project run smoother than any project I have EVER been involved with before. ATR WAS THERE EVERYTIME, ON TIME, WITHOUT EXCEPTION!

Thank you again, Bill

As the electronics recovery industry has evolved, processors have realized the opportunities that arise if they can do more than just take in material for recycling or reuse. With so many skilled companies now in the sector, savvy players are staying ahead of the competition by offering tailored services to generators of end-of-life electronics.

In short, growth in e-scrap today is being fueled by custom solutions as much as it is by commodity sales.

For a telling example of what is demanded to keep pace in the client-service space, we can look to a project recently undertaken by Advanced Technology Recycling (ATR), which operates multiple U.S. facilities and specializes in providing sales and services in the realm of IT asset disposition (ITAD).

 

The ATR Approach

The first course of action taken by Advance Technology Recycling’s project manager was to divide the 2-year project into four distinct components with clear objectives as follows:

  1. Removal of 1,000,000 pounds of decommissioned electronics and lead acid batteries from more than 80 unique locations.
    1. The client set up collection sites to consolidate decommissioned equipment and lead acid batteries from over 1200 tower locations. Once the collection site accumulated ten thousand pounds of equipment, Advanced Technology was notified. Once notified, the equipment was collected within one week and transported to the nearest ATR warehouse for inventory, commodity sorting and potential resale opportunities.
  1. Removal of decommissioned equipment from the client’s 25,000 square foot warehouse.
    1. Advanced Technology Recycling utilized its fleet of semi-trucks and box trucks along with its workforce to palletize all equipment and transport it back to ATR’s nearest warehouse.
  1. Designate Advance Technology Recycling’s warehouse(s) as a drop off site.
    1. Several enclosures that housed decommissioned equipment also required recycling. Setting up our warehouse enabled these enclosures to be delivered to Advance Technology Recycling with the use of cranes and industrial forklifts to unload them.
  1. Inventory and recycling of the decommissioned equipment and lead acid batteries.
    1. Advanced Technology Recycling stored all materials in its secured and monitored warehouse to take inventory of the decommissioned equipment.
    2. Once inventoried, the decommissioned equipment was de-manufactured and recycled using Advance Technology Recycling’s existing R2 certified downstream vendors.
    3. A new downstream vendor was certified to handle over 330,000 pounds of lead acid batteries.

Accomplishing this task took logistics expertise, proven systems for remote data management, strong communication with the client, and, of course, talented personnel across the board.

 

As a global leader in ITAD (IT Asset Disposition) solutions since 1992, ATR has developed a robust marketplace to repurpose, resell and recycle business class electronics, and technology equipment that can no longer be used.   Most equipment ATR processes can be repaired and resold in the secondary markets like Ebay, via Wholesale distributors and through ATR’s online store.

 

E-commodities are essentially the components and accessories that make up the electronics we use each day. Recycling companies like ATR collect, sort, and refine these materials into specific categories based on value, material composition and contaminations present.   ATR has launched an innovative and transparent new program that helps business customers navigate this complex world of scrap commodities by breaking them into manageable categories.

e-Waste vs e-Commodities

Companies like ATR that are R2 and ISO certified must differentiate between assets that are serialized which require additional steps to manage vs materials like wire, batteries, and even metals that are often scattered throughout a shipment.  ATR’s eCommodity program provides the necessary guidelines to help customers separate materials that have value from those that do not.  Customers who wish to maximize their materials value can follow specific parameters that help reduce contaminants and increase values through consolidation.

 

For example, a load containing 10,000 pounds of e-Waste can include hundreds if not thousands of pounds of various types of wire and cabling scattered throughout the shipment.  ATR must untangle and sort this wire into various categories which significantly reduces or even eliminates any residual value to the originating customer.   However, if the client can separate all the wire from the rest of the equipment the segregated wire can now be bought and sold as a commodity.  Depending on the customers desire to maximize the materials value specific sorting methodologies can be used to remove contaminants and consolidate certain types that contain more Copper.

 

ATR has since improved on these processes by adding a dedicated compliance team that is made up of highly skilled and well-informed individuals strategically placed at nearly all ATR locations. The team systematically introduced a series of enhancements that include but are not limited to training programs, compliance guidelines, material management practices, processing objectives, and improved reporting metrics.

 

Additionally, ATR provided enhanced training to a small group of employees comprised of compliance, legal, logistics, and operational associates that gave them additional capabilities and security clearances necessary to identify and manage client vulnerabilities.  This team inspects material streams to locate hidden storage devices, asset tags, and equipment value frequently missed by traditional processors.

 

Through these and other initiatives ATR became increasingly proficient with managing highly sensitive assets for clients that require customizable guaranteed destruction services.  However, only a small percentage of equipment ATR manages falls under these guidelines, as most entities within the private sector have vested interest in generating revenue from their retired electronics and IT assets.   ATR resolved this issue by relocating all recovery, resale, and testing operations to a newly renovated facility on the corporate campus.   All shredding, and secure disposal services are carried out at a separate location code named “Prairie”.

The complexity of keeping track of assets

As is common in many scenarios such as this one, record-keeping on the part of this client did not align perfectly with real-time equipment lists being generated by ATR warehouse(s).

The client was able to provide ATR a detailed list of all the serial numbers that were thought to be included with each shipment, but it was common for discrepancies to exist between what was on the list and what was extracted. Some assets had been removed (without formal notation) to be reused internally as spares or relocated. This reality meant it was extremely important for ATR to accurately account for every managed asset, and to be transparent in all data-collection activities so the client would feel confident in the process.

Each recordable asset was checked in by serial number using portable bar code scanning technology and checked against an extensive device list that had been manually prepared by the client. The use of hand-held computers with built-in scanners helped eliminate any potential for user data entry errors (such typographical miscues are what cause a large portion of data accuracy issues that occur in these types of projects).

The information was stored on the hand-held device and transmitted to the ATR database upon the completion of the work at each location each day. ATR does have the capability to upload such data in real-time, using either the client’s internet or cellular technology but that was not necessary on this project.

The process of scanning each device allowed ATR to provide the client a spreadsheet list of each asset at any point during the processes, allowing an additional level of scrutiny when it came to the data and accountability. The customer was able to monitor the entire project using ATR’s web portal, which is compliant to Federal Information Processing Standard (FIPS) 140-2.

Once all the serial numbers at a given site were recorded and verified, the physical destruction portion of the project got underway. All shredded material was responsibly handled, with precious metals from circuit boards and ferrous and non-ferrous metals from casings destined for individual commodity recovery.

The entire process was captured on the client’s video surveillance systems for added security.

 

The importance of accuracy

Ultimately, the strategy paid off for both ATR and the client.

The ATR team cataloged, tested, and repurposed the equipment that had value and destroyed the remaining assets in an environmentally safe and sustainable eCommodity recovery process.  And detailed reports were provided to the client’s auditing team and senior management for an after-action audit of the project. The reporting included supporting documentation on some duplicate serial entries, some serial numbers most likely entered incorrectly by manual input, and the additional assets destroyed that were not on the original equipment list.

Inventory discrepancies were quickly identified using supporting documents, thus answering any questions from client management personnel who may not have been directly involved in the project.

In fact, the after-action meeting on accountability and reconciliation between client and vendor took only a couple of hours, not days or weeks or months as is all too often the case.

This project arose from the client’s need for implementation of a unique job at a reasonable cost. It was also important to minimize impact to the client’s operations. Meeting these client demands required creative solutions.

 

ATR’s Involvement with the Secure Network Act.

The Secure and Trusted Network Act of 2019 (SECURE NETWORK ACT) is the United States response to the largest cyber threat of modern times and will cost $1.2 Billion Dollars. 

Over the past decade, an increasing number of telecommunications companies began bringing forth litigation claiming the Chinese Telecom OEMs had stolen their intellectual property. Most recently, Reuters reported that Motorola, a Chicago IL. based company, was awarded $764 Million in damages against Chinese owned Hytera Communications, a “covered entity” under the Secure Network act.  Motorola Solutions said it was planning to seek an injunction preventing Hytera from further misappropriating trade secrets and infringing copyrights.  This case is not unique to Motorola or Hytera, and it was no surprise that as more evidence was brought forth, it became necessary for governments around the world to research the allegations and take corrective actions.

Efforts to thwart Chinese OEM’s entanglement strategies only worsened with the introduction of inexpensive 5G telecommunications equipment that the world was eager to deploy.  As the threat came into focus, a growing number of U.S. based telecom coalitions including the RWA began lobbying in Washington D.C. for financial aid to cover expenses needed to “Replace and Rip” the equipment.  The RWA and other coalitions outlined in great detail the detrimental effects of the “Rip and Replace” methodologies being considered would have if adequate reimbursement funding was not approved ahead of the impending ban.

In Q2 of 2021, ATR began monitoring communications on the FCC’s Electronic Comment Filing system.  ATR was aware of these filings through existing relationships we have with many of the companies that own towers and/or provide cellular services.   The FCC appointed this initiative to a division known as the Wireline Competition Bureau, which assigned docket 18-89 and placed it online for public comment and further case studies.

Docket 18-89 quickly became a heated battleground where Chinese OEMs and other interested parties did their best to influence the FCC on how best to resolve this situation.

ATR brings decades of industry experience to the table.

 

ATR staff became increasingly concerned that the FCC was considering using ITAR regulations to dispose of the “covered equipment” without properly defining how these assets should be destroyed.  Without these disposal guidelines, ITAR registered disposal companies would not have specific shredding and material management parameters necessary to follow established protocols.

Through a series of online meetings, the FCC’s appointed representatives requested ATR to provide recommendations on how ITAR and R2 certified disposal companies might use these guidelines to destroy equipment deemed critical to national security.

During the discovery phase ATR representatives identified potential deficiencies in the FCC’s proposed guidelines, questionable processing practices already taking place, and inadequate procedural recommendations being considered for ITAR material classifications. ATR representatives provided an informal response to key decision makers within the FCC task force in August of 2021.  The FCC requested additional information related to ITAR, transportation, storage, destruction practices, and industry specific certification standards, which were necessary if the FCC was to augment proposed guidelines being considered.

Under ATR’s ITAR guidelines, disposal processes are carried out by authorized and vetted U.S. persons, at R2 certified and ITAR registered facilities.  Additionally, ITAR regulations require processors to establish an unbroken chain of custody by ITAR approved personnel from the originating entity all the way to final disposition. Processing guidelines prohibit export of any device(s), component(s) and/or recovered material(s) outside the U.S. These processes must be well documented within the IMS (Integrated Management System) and approved by all governing agencies such as the DDTC or the R2’s governing entity, SERI.

ATR recommendations to the FCC.

 

It is the opinion of ATR (a current provider of R2 Certified ITAR disposal services since 2014), utilizing ITAR processing guidelines was an ideal mechanism to ensure sensitive electronics, as outlined in the Secure Network Act, were properly disposed of in a manner that protects national security.  Furthermore, Non-ITAR regulated asset management and disposal companies may not have the infrastructure or downstream processed needed to properly manage assets that have been deemed critical to national security.

For example, during our research we reviewed a case study which was submitted via ECFS from a company not certified at the time to the specified requirements as discussed in our meetings with the FCC.  ATR representatives noted the photos showing proof of destruction on the PCB (Printed Circuit Board) had been drilled and not shredded.  Although drilling a hole likely prevented the devices from functioning properly, this process would not be considered sufficient mutilation under ITAR regulations for highly sensitive and/or regulated assets.

It’s also worth noting, the report did not specify what happened to these devices after they drilled the small hole.  In most cases, ITAR controlled equipment/materials that contain sensitive data must be shredded, and the scrap PCBs, chips, and hardware that could potentially retain data must be secured and prepared for final disposition.  In these cases, ITAR processes require the shredded materials be securely transported, with an ITAR approved escort, to an ITAR registered refining partner.  The approved partner then smelts the metals further to recover Gold, Silver, and other precision metals.   This process must take place on U.S. soil, at R2 and ITAR approved facilities, and only by authorized U.S. persons that meet the specified level of security deemed appropriate by the materials classification codes.

It is the opinion of ATR, the majority of the “covered equipment” meets the specified criteria, as outlined in the e-CFR (Electronic Code of Federal Regulations), under Title 22 → Chapter I → Subchapter M →, Part 120sections, §120.3, and §120.4,  commodity jurisdiction.

Furthermore, ATR believes the “covered equipment’s” data bearing assets also meet the necessary criteria, as outlined in sections §120.3, and §120.4 , as published in the e-CFR publication.  ATR recommended following regulations that replicate disposal protocols currently in use for sensitive military telecommunications apparatus, as required under ITAR [22 CFR 120-130], and subject to EAR [15 CFR 730-740], 4 export guidelines, until such time further regulations are defined, and/or implemented.

On September 3, 2021, ATR presented our findings, which included detailed excerpts from e-CFR publications, and U.S. Export Administration Regulations (EAR), to the FCC, FBI, and their attorneys, via the approved channels.  Additionally, ATR provided the FCC task force with specific protocols they would need to follow if they intended to petition the DDTC, and EAR, to have the Chinese telecommunications equipment added to the U.S. Munition list.

The case study also included specific processing guidelines ATR suggested the FCC should consider implementing.

Based on preliminary equipment lists, ATR believes there are 3 general disposal categories.

  • Non-Regulated – Assets under this category are not subject to ITAR and EAR guidelines and may be recycled locally. This category may contain inert items such as wire, metal cabinets, mounting hardware, antenna, and supportive equipment.
  • Regulated- Sensitive – Assets under this category are not subject to ITAR and EAR guidelines but may contain proprietary data and although not a significant risk to national security a guaranteed destruction solution by an R2 Certified or equivalent End-of-Life processor is required to prevent equipment from being repurposed in any way or harvested for parts.
  • Regulated- Highly Sensitive – Assets under this category are subject to ITAR and EAR guidelines and deemed a threat to national security. Should the FCC adopt this level of disposal ITAR registered and R2 or equivalent certified companies are the only ones allowed to perform the disposal process.

 

The Conclusion.

The ATR docket was approved, and published on September 7, 2021 for public viewing, and comment.  On September 30, 2021, the FCC’s Wireline Competition Bureau published the finalized disposal guidelines that included statements indicating they agreed with ATR, and subsequently used the recommendations we provided and shown herein.

On September 8, 2021, ATR successfully completed a “change management review” and it was determined the materials in question would be accepted at all ATR facilities.   Additionally, ATR used existing ITAR processes, forms, and methodologies, to create an entirely new process, called STCNA19.  These new processes closely replicate existing ITAR protocols but eliminate the need for DDTC, and EAR disposal reporting requirements.

Please note, specific processes are not disclosed in this case study to protect ATR’s intellectual property, and process integrity. 

 

About ATR

Advanced Technology Recycling (ATR) is a certified Woman Owned IT Asset Management (ITAD) company that specializes in Secure Destruction and Forward/Reverse Logistics.  ATR operates seven (7) fully certified R2:2013, ISO 14001:2015, ISO 45001:2018 facilities throughout the U.S. with an eighth location coming online in Allentown PA in Q2 of 2022.  ATR has been ITAR registered since 2014, and we provide many discounted services to a growing list of State and Federal Agencies through our GSA Schedule.   ATR utilizes sophisticated vehicle tracking and remote inventory control software so clients can schedule and monitor all workflows in real-time through our FIPS 140-2 compliant web portal.

In addition to an ever-expanding portfolio of ITAD and Recycling services we also offer FCC approved and FBI vetted disposal solutions for Huawei and other covered Rip and Replace equipment.  ATR is authorized by the US State Department and Homeland Security to provide SDS (Secure Destruction Services) to highly volatile waste streams for Aerospace, Defense and all federal agencies including the FBI, FAA, and the US Border Patrol just to list a few.

ATR offers a wide range of value recovery and fee management programs including a wholesale marketplace and eCommodity Exchange to help maximize client returns.    Working with ATR in a “Value Driven Vendor Partnership” will leverage ATR’s impeccable reputation within our industry and ensure the very highest degree of protection.

Author: Brodie Ehresman

Brodie Ehresman is one of the originating family owners of the two facilities formed in 1992 and is acting Director of Marketing. Brodie utilizes his 30+ years of IT background and entrepreneurship to develop innovative sustainable recycling solutions to help ATR customers improve their triple bottom line.