eSIM ready to take‐off in consumer devices

12th September 2019

eSIM ready to take‐off in consumer devices

The much hyped eSIM technology is no longer a futuristic promise but has well and truly reached the mass market.

The rise of eSIM technology

eSIMs, first introduced back in 2012, have the same performance functionality as traditional SIMs — storing the unique subscriber ID, authentication keys and mobile applications. However, they also provide an additional range of benefits, beyond that of a traditional SIM. This is because they are soldered directly onto the mainboard of a vehicle’s on‐board unit or other connected devices – overcoming the challenges of the legacy removable SIM.

These benefits were first explored and realized by the automotive sector. As the concept of the ‘connected car’ came to life, and cars became more digitized, there was a pressing need for connectivity to be built into the vehicles. Cars therefore, in a way, began to replicate smartphones, with SIM devices being built or ‘soldered’ into the cars themselves – turning them into connected vehicles. Whilst this allowed greater connectivity – an obvious barrier arose. If a user / manufacturer wanted to change to a different mobile network operator (MNO), they would be unable to easily switch out the traditional SIM card, as you would in a phone. The flexibility of the eSIM offered the perfect solution, allowing embedded SIMs within a car to be changed remotely.

The flexibility of the eSIM offered the perfect solution, allowing embedded SIMs within a car to be changed remotely

The needs of the digitized automotive industry served as a main initial driver of eSIM technology landing on the mass market. Next, came the rise of high‐tech consumer devices — such as smartwatches. The sleek product designs, often needing to be fully sealed and waterproof, could not adequately accommodate traditional SIM cards and their SIM slots. Again here, eSIMs offered a seamless solution.

The continued development of smart devices such as tablets and smartphones – again with sleeker and smaller designs, fueled the rise of eSIM technology in consumer devices. Not only do they better suit the modern smart device design, but they make the activation and management of mobile contracts an easier process for both the user and the MNO. Since 2018, eSIM‐ready phones have been commercially available.

The needs of digitally transforming industries, and the solutions and benefits eSIM offers have led to the prevalence of eSIM technology on the mass market.

Five signs that eSIM is ready to take‐off on the consumer market

The drivers and demands for eSIM technology are clear. The following 5 key factors indicate that it’s now ready to be adopted on a mass scale in the consumer market.

1. Apple relies on eSIM

At the launch of its new iPhones in September 2018, Apple announced that all three new iPhones support eSIM functionality (eSIM was already supported in the Apple watch and Apple iPad). With a global tech giant leading the way, this announcement has encouraged the advancement and integration of eSIM into other vendors’ devices. As a result, industry analyst forecasts for the eSIM market (within consumer devices) for 2019 increased almost tenfold. Since then, Apple’s updated iPad Air and Mini now also support eSIM, in addition to all the new cellular devices announced at Apple’s keynote in September 2019.

Industry analyst forecasts for the eSIM market (within consumer devices) for 2019 increased almost tenfold

2. Activity among other leading manufacturers picks up

Other tech titans are now also using eSIM technology in a wide array of consumer devices. Samsung have implemented eSIM technology in several product generations of their smartwatches, and Google benefits from the advantages of this technology in its Google Fi service, and has done since 2017. It’s clear that manufacturers are increasingly equipping new devices with the eSIM capability. Leading Chinese and Japanese manufacturers are also already testing and preparing for the technology. The first eSIM‐only companion feature phone has been available in Japan for several months now. “The mobile ecosystem is reaching a level of maturity that will lead to the mass adoption of eSIM in consumer devices. Manufacturers recognize the potential that eSIM can bring: further streamlining their devices; ensuring new models are ‘future‐proofed’ and enabling connectivity to a new class of devices such as wearables, tablets, laptops,” says Anthony Dornan, telecoms consultant at Delta Partners, a telecoms industry consultancy.

3. Integration with further device types

According to the UN, by 2023 an average person is expected to have around 4 connected consumer devices.

Managing billions of connected products using legacy SIM cards is a logistical issue in terms of their activation and management. Increasingly demanding consumers, and a rising agile workforce who expect and require always‐on connectivity and a frictionless experience when dealing with mobile operators, are pushing the adoption of eSIMs, which can provide devices with permanent internet connection.

According to a survey by consultancy Arthur D. Little, 60 per cent of people want effortless device activation, which eSIMs can provide. The notion of the “always on” consumer, must now be met by the “always connected” company.

60 per cent of people want effortless device activation

In addition to the ‘better known’ smart devices such as smartwatches, ABI Research predicts an eSIM uptake in devices such as consumer trackers, portable gaming, speakers, and connected toys.

Several tech incubators are presently supporting early‐stage startups trailing new consumer IoT and eSIM‐enabled devices, such as smoke detectors, headsets, baby or health monitoring wearables. eSIM is therefore not only responding to the needs of the current smart device market, but is helping expand the device ecosystem beyond smartphones, by utilizing the opportunity of mainly companion devices.

4. Network operators are “eSIM ready”

Another key indicator that the eSIM is ready to take off in the mass market is the preparedness of the network operator community, for the broad use and implementation of eSIM. Across this community, we are already seeing encouraging movement. Certain major mobile communications providers are currently offering eSIM services with smaller providers and mobile virtual network operators (MVNOs) racing to catch up. It’s clear network operators of all sizes are appreciating the strategic importance of eSIM.

5. Global standard is ready

A GSMA specification now provides a global standard for the remote SIM provisioning (RSP) of consumer devices. This means that all providers across the mobile industry ecosystem, spanning operators to device vendors, can embrace a framework that enables worldwide users to manage eSIMs in their mobile devices.

“Thanks to the GMSA, mobile players now have the platform to build‐out against a consistent standard, ensuring that both device manufacturers and telcos can optimize the development of new devices and services,” says Dornan.

Security implications

SIMs in all forms still remain the security anchor to ensure mobile applications and solutions are safe. The rise of eSIM technology does not change this fact. Security parameters of eSIM are arguably at the same level as that of traditional SIM processes and solutions.

“eSIM is a secure solution — similar to traditional SIMs — that retains both a hardware and software component for authentication,” says Mr Dornan.

The essential thing is to maintain, if not increase, the core foundation of security throughout.

Even as the adoption of eSIMs takes off, security aspects of this technology are more than able to keep up. “eSIM technology has reached the mass market – even earlier than expected,” explains Carsten Ahrens, CEO of G+D Mobile Security. “The essential thing is to maintain, if not increase, the core foundation of security throughout. Our eSIM solutions combine the highest security levels of the traditional physical SIM card with significantly improved usability.”

LIST OF eSIM‐ENABLED DEVICES

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