IoT is with no doubt the next big wave of the cellular technology revolution with an estimate of 50 billion IoT devices to be connected by 2020! With the wide variety of functions these devices perform – given their application across various industries such as smart home, smart cities, healthcare, energy and transportation – several factors will shape the future of this business, including on-demand connectivity and inter-operability.
50 billion IoT devices to be connected by 2020!
For those who still don't know, the e-SIM (embedded SIM) is simply an evolution of the traditional SIM card. It’s re-programmable and can support multiple profiles.
How does it differ from the traditional SIM card?
This technology offers the ability to remotely change service provider, and it embodies exceptional features that relate to the connectivity and inter-operability requirements of IoT:
- Remote provisioning: the physical SIM is tied to a single operator, whereas the e-SIM’s remote provisioning system allows consumers to download and install operator profiles “over-the -air”. This allows a faster connectivity, and an easy switching between network operators on the same device.
- Small size: the physical SIM card is relatively big, and its shape is constraining in terms of the device’s design, manufacturing and interoperability. This issue is eliminated with the e-SIM, allowing manufacturing sleek and cost-effective devices.
As a matter of fact, the e-SIM brings in benefits for all the players of the landscape!
- OEMs: can widely benefit from manufacturing IoT enabled devices, carrying an e-SIM that can be activated anywhere in the world.
- SIM vendors: can also expand their competency to support profile creation, user authentication, data encryption and security.
- Users: Since the e-SIM is much smaller than a traditional SIM, there’s more space available, whether for an extra battery or for new features. Moreover, with e-SIM integrated directly into the terminal, users can connect their device instantly.
- While the shift from a physical SIM to e-SIM will simplify logistics, it will still pose unique challenges to the MNOs in terms of applying considerable changes to their business models in order to retain their competitive edge.
Samsung, Huawei or Apple for some of their connected watch models.
A look at media:
Apple has turned to eSIM to add connectivity to the Apple Watch Series 3 and Watch Series 4 as well as dual SIM support for the new iPhone XS and XS Max.
Google's Pixel 2 also supported eSIM but it was only used in the US for Google's Project Fi.
Importance of MNOs will be signified…
It's no longer a matter of whether e-SIM catches on. It's a question of when and who is best placed to take advantage of it!
As connectivity is key, the MNOs’ role in the IoT ecosystem continues to be significant. It is estimated that IoT revenues for MNOs from connectivity alone are estimated at about 25%, while the remaining will be through their offered value added services. The e-SIM also opens access to data about consumer habits, which in turn provides valuable insight for OEMs and MNOs to create newer products and services, increasing their business potential.
Building partnerships and developing services that support each other are going to be key in delivering secure, scalable and functional connectivity for IoT devices of the future.