Device as a service (DaaS) business model – implications for circular economy

ESG
06/03/2023 Article
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Nicole Daschner

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Strategic Partnerships and Sustainability

From owning to using

Climate change requires a fast transformation towards a carbon-conscious economy as well as new consumption and production patterns. XaaS (everything as a service) models contribute to this transformation by creating true value for customers – with less material, waste, and operating costs. Why? Because XaaS models are by definition more demand-driven and customized to the customers’ actual needs, contrary to the traditional linear ‘take-make-dispose’ principle.

Device as a service (DaaS)

As-a-service means selling a value proposition instead of products: in the case of hardware, it means understanding that companies and their employees do not ‘need’ smartphones and laptops as such, but need to stay connected and operational at all times. Long-term value emerges when devices are not simply provided, but maintained and serviced. DaaS providers maintain ownership of the devices and are, thus, incentivized to adopt circular strategies to protect their assets, extending the life cycle of each device. A triad of reusing, refurbishing, and recycling increases its value over its lifespan and, therefore, challenges linear economy production patterns.

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