Sony's Cadmium Heartburn
The Cost of Non-compliance
On December 4th of 2001, CNN reported on the Netherlands government seizure of 1.3 million Sony Playstation game machines. The estimated value of the items seized was $162 million US. The reason: Cadmium in some of the cables.
Since then, the story has taken on a life of its own among people working towards RoHS compliance. It has morphed somewhat in the rumor mill. Some attribute the seizure to RoHS - patently untrue, since RoHS does not take effect until July 1, 2006. The cost to Sony has dropped to $93 million. This could very well be true, if Sony overestimated the value initially. One telling of the story suggests that one of Sony's competitors tipped off the authorities, who would have remained clueless otherwise.
The reality is that this event happened well before the RoHS directive was drafted. The Netherlands had a regulation banning Cadmium, in place by 1999. Exactly how the Playstation cables came to the attention of the Dutch inspectors is not exactly clear. A tip-off is plausible, though I doubt anyone would confirm that. Ultimately, Sony recalled all the affected items and reworked them at a very high cost, possibly the rumored $93 million.
Significantly, this remains a cautionary tale. Once RoHS goes into effect, this little drama is very likely to be repeated throughout Europe, China, and Japan. If products contain the banned six, inspectors will find out, by whatever means. Compliance is the only viable defense, as well as a potential competitive advantage. Choose green and grow your business; ignore these regulations at your peril.