It’s predicted that by 2020 there will be 11.6 billion mobile devices, according to Huawei, connected by over 500 mobile network operators (MNO) worldwide.
With this growth in connectivity fuelled by trends such as the Internet of Things (IoT), attention is switching to the hardware and whether it is capable of meeting demand. In addition, as connected devices get smaller with each technological iteration, they are still expected to have the processing capacity to perform a multitude of functions. On top of this, they will also need to have built-in, stand-alone mobile connectivity in order to work the way users want and need.
However, the traditional SIM card (which connects to only one MNO) inhibits the growth of this vastly connected IoT network, for three key reasons.
- The supply chain has become too complex: multiple devices, profiles and locations of use mean that the traditional SIM is unable to be configured to simplify this process.
- Excess activation times and no interoperability between MNOs: customer journeys can be unnecessarily painful, with devices and connectivity sold separately and consumers being locked into one network.
- Not fit for new innovations: original equipment manufacturers (OEMs) face new constraints that traditional SIMs simply can’t overcome, such as miniaturisation and waterproofness.
Combined, these factors are holding OEMs back from creating the devices capable of true IoT connectivity. How can OEMs overcome this and ensure the traditional SIM doesn’t stand in the way of innovation?
Enter the eSIM, that’s ready to roll from day one: pre-installed into a device and capable of connecting to any network. eSIMs combined with ‘On Demand Connectivity’ (ODC), allows management of the connectivity of a device through its entire lifecycle to ensure the long-term reliability of the device, from initial provisioning to contextual change – wherever the person is in the world.
So why is the eSIM taking off now? Until recently, the technology behind the creation of the ecosystem has not been advanced enough and costs have been too high for widespread production. There’s also been the issue of standardisation, something that has long held back true adoption of the IoT. However, OEMs are starting to realise the potential eSIMs have in driving new revenue streams and meeting regulatory compliance, as well as offering the standardised platform manufacturers can build their products upon – allowing all devices to connect.
The demand from consumers has also not been there until now. As more of our devices become connected, we require a lot of data to ensure they all work as fast as we want. Tablets are a great example of this. For those without a data package, the mobile connectivity dream can be short-lived – either having to prepare for trips in advance by downloading content or using their mobile to create a wireless hotspot. This can be unsustainable as it drains both battery life and data allowance.
The eSIM creates a ‘one-step connection’ functionality that connects devices, like tablets or, increasingly, smart watches, to 3G or 4G. From there, consumers can easily manage their data connection through the device itself, when and where they need it, with the pricing deal that suits them.
For OEMs and MNOs, the real benefit of eSIMs is the data they will generate and the insight they provide about consumer habits. This will enable them to gain real insights into how consumers are using their products and tailor their offerings to specific needs. It’s this insight that shows the true value that eSIMs can offer, with consumers receiving a personalised experience that can bring true value and make their lives easier.
SIMs should no longer be considered a barrier to innovation, but instead an enabler to improve standardisation platforms. Those that embrace it can help turn the IoT from something with incredible potential into a reality.
Interested in hearing industry leaders discuss subjects like this and sharing their IoT use-cases? Attend the IoT Tech Expo World Series events with upcoming shows in Silicon Valley, London and Amsterdam to learn more.