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eSIM Age: An answer to all future complications of traditional SIM

2 mins read
This piece is also featured in the Show Daily at Mobile World Congress in Barcelona. The embedded SIM (eSIM) is paving the way for a truly borderless mobile experience for people and things, and driving digital transformation across the global mobile and IoT ecosystem. More and more enterprises – including technology giants such as Apple and Google – are embracing the eSIM to ensure their devices are future-proof and network-ready, and Ovum predicts that eSIM unit shipments will grow nearly 10-fold from 2019 to 2022. The conventional physical SIM = a difficult partner The conventional SIM can enable cost-effective, reliable and secure connectivity. However, it also requires difficult choices to be made very early in the manufacturing process. These choices – such as selecting a particular communications service provider (CSP) for connectivity services - will have an indelible impact on the way a device is connected over its lifetime, regardless of where or how it will be used. Further complications with the traditional SIM can arise once the device is in the field. Inter-operability issues can make switching CSPs a challenge, especially in an industrial IoT environment. To illustrate, the use of IoT devices in remote or hard-to-reach locations can be expensive, because staff must be deployed to physically swap one SIM for another to be able to change CSPs. In reality, this may effectively create a situation of CSP lock-in. Add in the need to comply with regional or national regulatory requirements – which can impose limitations on permanent roaming – and designing connectivity at the point of manufacture becomes a real headache. Adopting eSIM – what’s gained? (hint: agility, flexibility) With a 5G future set to be filled with billions of connected ‘things’, the development of the decades-old SIM couldn’t have come at a more crucial time. A fully-integrated 5G-capable eSIM offers flexibility in capabilities never seen before – but this is indeed a revolution, not an evolution. An eSIM enables seamless switching of mobile CSPs remotely using over-the-air (OTA) updates, without the need to physically exchange. That is why the eSIM can have a transformational impact on IoT. Its benefits include:
  • Significant cost savings, both in terms of the manufacturing process and ease of changing connectivity contracts and SIM providers post-production
  • Greater control over network selection and customised service, even after the production, shipment and deployment of connected devices
  • Easier adherence to country and region-specific regulatory requirements
  • Better coverage and enhanced security
  Commercial advantages Because of these benefits, the eSIM also offers many commercial advantages. It simplifies supply chains, meaning that OEMs will no longer need to keep an inventory of SIMs. Most importantly, the eSIM allows OEMs to focus on product innovation, rather than operational concerns. They will be able to design sleeker, more resistant and more cost-effective devices – crucial for an IoT industry seeking small, tough, zero-maintenance devices. For CSPs, the eSIM open up a world of opportunity far beyond the traditional mobile market. They could provide convergent offerings between a variety of devices – a smartwatch, a mobile device and a vehicle, for example – and generate new revenue streams from new innovative business models. What’s next for the eSIM? The eSIM has ushered in a new era of control and flexibility in the way that both consumer and industrial IoT devices are connected. But with any disruption to the digital landscape, new challenges inevitably emerge. Around a decade of development lies behind today’s GSMA eSIM standards. Yet the new commercial models and benefits the eSIM may bring about are still being debated and tested. Expertise in managing eSIMs may be lacking among OEMs that want to use the technology and take advantage of its flexibility, post-deployment, in the field: while traditional SIMs have typically been configured one time for a specific device, CSPs will need to update their BSS/OSS infrastructure. This is essential - to enable management of devices and new commercial models and to ensure the same level of security and authenticated access to mobile networks provided by traditional SIMs. Deploying eSIMs may also require CSPs to rethink their own business models. For example, how will the use of eSIM work in markets where CSPs subsidise devices which are locked to their own network? With any large-scale change of this kind, some guiding principles are needed – and adherence to GSMA specifications is critical. The adoption of an industry-wide ‘hubbing’ model would help address these challenges for eSIM providers, CSPs and OEMs alike. Such an approach would provide full inter-operability between eSIM vendors and CSPs, while supporting OEMs and distribution processes. It would ensure the seamless factory-to-field connectivity that the eSIM is designed to deliver, and create the secure operating environment needed to fulfil the enormous potential of this technology in the future. Read our previous blog on adopting Global SIM.

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