How will the emergence of eSIM impact IoT?

SIM cards, those little pieces of plastic that live in almost all of our mobile phones, have existed since the birth of the consumer mobile market and play a critical role in identifying users. For the Internet of Things (IoT) however, basic SIM cards are holding back advances in technology. In fact, for many IoT applications, SIM cards are proving to be costly, insecure, inflexible and not suitable for deployment.

Consider how plastic SIM cards affect IoT devices: they require a slot to be incorporated into a device. Once deployed a SIM isn’t designed to be updated over the air. And if you want to make changes you have to remove the now useless piece of plastic and exchange it with a new SIM.

The good news is that the solution to these problems is already here: the eSIM. While some consumer mobile phones are also beginning to embrace eSIM, it’s arguably the IoT where the biggest benefits will be seen.

Plastic SIM cards are a problem for low margin, high volume IoT applications. When compared to the cost of embedding an eSIM that can be endlessly configured remotely to select the best available network once deployed, the traditional SIM is really blown out of the water for many deployments.

What do we mean by eSIM?

eSIM is a global specification by the GSMA which enables remote SIM provisioning of any mobile device.

With an eSIM enabled device, users can store multiple operator profiles on a device simultaneously and switch between them remotely. This means manufacturers and operators can enable users to select the operator of their choice and then securely download that operator’s SIM application.

Additional benefits include simpler device setup without the need to insert or replace a SIM cards, devices that can operate independently of a tethered smartphone, with their own subscriptions and the development of smaller devices.

Overcoming traditional challenges

So what else makes an eSIM better for the IoT? Well, the device no longer has to cater for a removable card. That means the IoT device can be very small, which could be vital for many applications in cellular IoT. It also removes the cost and vulnerability of an external port, as well as the environmental impact of plastic SIM cards.

An eSIM holds multiple local network operator credentials, in contrast to a conventional SIM card that can only hold one. An eSIM can also be reprogrammed over the air. Such capabilities not only allow for future technology enhancements but also repeated updates with profiles suitable for the local network. This eliminates challenges that come from constant roaming and allow the connected device to take advantage of local data rates, that are typically cheaper and avoid any data throttling. Minimising costs while maximising data speed and stability will be a key enabler to accelerate IoT adoption.

As Global Distribution Systems (GDS) for eSIM are developed, it will be easy for IoT service providers and end-users to choose the network that is right for them at any time and switch to the best network without having to switch SIM cards or waste time comparing rates. It will be a simple, instant, effective process.

Additionally, manufacturers no longer need to provision devices for each specific country at the production stage. Devices can instead hold universal connectivity through a provisional bootstrap network profile. The bootstrap profile enables the device to download a fully operational profile once out in the local market. This saves manufacturers a significant amount of time and cost in product distribution and stock management with a single SKU able to be sold anywhere in the world.

Flexibility and the IoT

One of the most important benefits eSIM brings to manufacturers, service providers and end-users is flexibility. For IoT enterprises, there is no need to physically install or replace potentially millions of SIM cards for their connected devices. That’s crucial as some devices may be used in remote areas or locations difficult to access. The transition to eSIM is a key milestone and enabler for cellular IoT to take off.

The scale of this opportunity is not to be underestimated. The GSMA predicts that there will be 25.2 billion connected devices in circulation by 2025. With the emergence of 5G and rapidly increasing network speeds and capacity, it’s clear to see how many IoT devices could benefit from a cellular connection through an eSIM. Especially as eSIM solves the fundamental challenge of managing connectivity remotely.

eSIM also opens new pathways for different uses of mobile technology. Consider the connected car as an example. It may still sound futuristic, but there are millions of connected cars on our roads that have already embraced eSIM. Connected cars rely on networks to provide a variety of services to vehicle owners, including navigation, entertainment, breakdown services, telematics and diagnostics. With critical real-time services like navigation and breakdown provision, there’s a great deal of value in automatically choosing the best available network connection.

While most IoT devices will perform fewer functions on their own, it’s clear that eSIM could improve their connectivity options and benefit manufactures, service providers and end-users alike.