Achieving Maximum Growth From the eSIM Shift

The embedded subscriber identity module or eSIM landscape is evolving rapidly.

In the United States, Apple has already switched to the eSIM-only iPhone. It started with the launch of the iPhone 14 in September 2022, followed by the iPhone 15 launch the following year. eSIM cloud service providers have enabled mobile network operators to support these eSIM-only and other eSIM-enabled devices.

The Inevitable and Inexorable Shift to eSIM

Counterpoint Research predicts there will be 14 billion eSIM devices in the market by the end of 2030.

It should only be a matter of time before all the other original equipment manufacturers follow Apple’s example. The eSIM-only iPhone should normalise the use of eSIM and soon make eSIM’s remote provisioning and SIM management the norm in the consumer market.

The integrated SIM (iSIM), with the SIM chip integrated directly into the device processor, is also now being studied. It’s a likely next step in the evolution of the eSIM form factor, and its adoption would mean a definite commitment to eSIM connectivity by OEMs.

There’s also the growth of the IoT industry. The Internet of Things (IoT) segment will likely be an active contributor to the eSIM shift, helped along by developments in 5G technology.

The 5G or 5th generation mobile network global wireless standard is the ideal network environment for IoT connectivity. Among its many characteristics that enable IoT are:

• High-traffic volume capacity
• Low network latency
• Network slicing
• Enhanced security

5G also enables edge computing, a definite improvement for IoT connectivity infrastructures.

As the IoT market expands, there will be a need for more efficient solutions to facilitate the IoT ecosystem. eSIM (and, later, iSIM), with its convenient form factor and over-the-air provisioning, is such a solution. The GSM Association (GSMA) understands this and has already released new eSIM standards for IoT.

Juniper Research predicts IoT devices will comprise more than 70% of the eSIM connections by 2027. In short, the future will be rife with eSIM-enabled IoT devices, such as smart locks, displays, metres, asset trackers, activity trackers, smoke alarms, drones, vehicles, and many more.

Capitalising on the eSIM Shift

The above trends underscore the inevitability and inexorability of the shift to eSIM in consumer and enterprise markets. It is apparent telcos must adapt, innovate and overcome the current challenges of providing eSIM connectivity to their subscribers.

The following are the capabilities telcos must build to capitalise on the eSIM shift.

1. Channel Management
   

   The rise in eSIM adoption has opened the door to specialist companies that provide niche consumer and enterprise solutions centred around eSIM. These are typically mobile virtual network operators (MVNOs), enablers (MVNEs), aggregators (MVNAs), and MVNXs (mobile virtual network companies that sit in the sweet spot between enablement and aggregation).

   Holafly and Airalo, offering digital SIM cards geared towards travellers, are examples. Telcos can work with these niche companies to activate more sales channels for their connectivity services.

   To make this possible, telcos must have a unified channel management platform. This will enable them to efficiently manage and effectively provision their channel partners.

2. Profile Development

   The diversity in eSIM-capable devices, ranging from consumer mobile phones to IoT devices, calls for an equally diverse range of eSIM profiles.

   Telcos need an eSIM management platform that automates profile creation, reducing costs and the time from request to fulfilment while ensuring version control, effective online management and reduced error margins.

3. Profile Management

   eSIM profiles must be activated, approved and archived throughout their lifecycle. Thus, telcos need a profile management platform that sets automatic distribution ratios and pre-assigns profiles based on specific parameters to ensure smoother operations.

4. Order Management

   The growing travel eSIM demand and the broadening range of eSIM devices pose inventory challenges for telcos. Real-time inventory tracking systems that offer automated top-up recommendations can prevent profile stock-out losses.

5. Profile Delivery

   Automated systems that identify and deliver the correct profile based on the embedded universal integrated circuit card (eUICC) capabilities of devices can save telcos time and enhance user experience.

   Tools that offer real-time customisation of profiles and allow telcos to manage points of sale effectively can be particularly beneficial.

6. Value-Added Services (VAS)

   The variety of eSIM channel partners means unique business models and needs. A suite of SIM applets and over-the-air capabilities can help telcos offer a tailored solution, meeting a range of channel partner requirements.

7. Device Entitlement

   The expected rise in eSIM IoT connections requires telcos to effectively manage various devices. Platforms that facilitate large-scale remote management, catering to diverse IoT devices and companion devices, are critical.

eSIM Management Platform

Soon, eSIM will be the norm among consumer and enterprise markets. Consumer device OEMs should soon follow Apple’s example and build eSIM-only devices. Enterprises will likely use 5G to implement IoT solutions, such as automating logistics facilities.

Telcos can capitalise on the shift if they build their capabilities in channel management, profile development, profile management, order management, profile delivery, service customisation, and device entitlement. In other words, they need a powerful multi-channel, multi-device, multi-system eSIM management platform to provide all these capabilities.