eSIM market ⋆ Alertify

eSIM market

The embedded SIM (eSIM) market is expected to register a CAGR of 15.47% over the forecast period from 2021 to 2026. It’s been estimated that Internet of Things (IoT) devices will become the largest connected category within the next few years, overtaking mobile phones. The eSIM helps these connected devices work and enables new types of devices with less compromise.

Wearables are one category that significantly benefits from an eSIM because the accommodation of a more significant physical SIM in the device will result in the usage of extra space, and to compensate for that, the batter size of the wearable can be compromised. Automotive makers, with the usage of an eSIM, allow the user to connect the cars to cellular quickly. Laptops will benefit from the addition of the eSIM while providing brands and re-sellers with the opportunity to up-sell/cross-sell through flexible data bundles.

In November 2019, 1oT, the virtual connectivity provider for global IoT device makers, and Valid, an eSIM solution provider, announced a collaboration introducing a full end-to-end eSIM solution for the IoT space. Valid’s subscription management services and eSIM technology coupled with 1oT’s scope and several pre-negotiated mobile carrier deals, produce a cost-effective and reliable connectivity solution. 1oT’s eSIM offering provides a single point of contact for IoT connectivity by acting as an aggregator of various carrier services. IoT service providers can now use one robust system that gathers different carrier deals and eSIM management under one roof instead of handling multiple carrier deals and SIM cards for use in different countries or regions.
As eSIM enables users to connect more devices to their mobile operators, operators can offer multi-device packages and bespoke data plans. With eSIM, device bundling will become much more accessible, with consumers conveniently adding new devices to their plans without having to go in-store or wait for a physical SIM card to arrive in the post. In turn, this presents additional revenue opportunities for mobile operators as their customers scale up their plans by adding new devices that require data. Businesses with many mobiles used by their employees will also benefit from the convenience of eSIM. eSIM can deliver a better user experience for managing cellular connectivity. Profiles for each user can also be personalized, and data plans can be adjusted and optimized via eSIM remote management tools.
Multiple countries are witnessing the deployment of eSIM. For instance, in April 2020, stc announced a localizing platform for eSIM for the first time in Saudi Arabia and obtained an international accreditation deemed requisite for rolling out eSIM technology. stc can provide eSIM services to all mobile and Virtual Network Operators (MNOs/MVNOs) in the country as a national eSIM platform. Also, the service can be extended to other MNOs in the Arabian Gulf region or internationally interested in obtaining the eSIM service from STC. The adoption of eSIM in Saudi Arabia in cooperation with GSMA Certification is expected to be a step towards achieving the mandates of Saudi Vision 2030, by localizing eSIM technology and further enabling digital transformation.

The smartphone is Expected to Witness Significant Growth

As smartphone manufacturers continuously strive to make smaller, slimmer, and lighter devices with more features, space is at an absolute premium. The size of the Nano SIM card is about 12.30 mm in length and 8.80 mm wide. It also takes additional space associated with internal hardware and circuitry that needs to be accommodated. For many years, manufacturers have had to design and adjust the physical SIM card via SIM card trays or other internal slots. The need for more durable and waterproof phones is expected to drive the removal of the physical SIM tray will drive the adoption of eSIM on smartphones. Remote Provisioning capabilities within the eSIM standard are expected to provide users with an enhanced customer experience for activating and managing their phones.
Samsung’s inclusion of eSIM technology in its S20 range of devices is expected to positively impact the adoption of eSIM in smartphones, which was previously confined to limited brands such as Apple and Google. In August 2020, NXP Semiconductors N.V. announced that NXP’s embedded SIM (eSIM), Secure Ultra-Wideband (UWB) fine-ranging solution, as well as Secure Element (S.E.) and Near Field Communication (NFC) unit, are deployed in Samsung’s new Galaxy Note20 Ultra. Unlike the physical SIM cards that must be removed and replaced in new devices, NXP’s GSMA-compliant eSIM solution is integrated into a device, making remote SIM provisioning significantly easier and providing over-the-air SIM updates. The eSIM functionality comes with all Samsung Galaxy Note20 Ultra devices, excluding Japan, China, and Korea.

North America is Expected to Hold a Significant Share of eSIM Market

The North American region is expected to hold a significant share as it is the first region that rolled out the support for eSIM, and major carriers in the region provide the eSIM service. In the United States, AT&T, T-Mobile, Truphone, Ubigi, and Verizon Wireless offer the support of eSIM functionality, whereas in Canada, Bell, Freedom, Fido, Koodo, Lucky Mobile, Rogers, Telus, and Virgin provide the support. In January 2020, Telus and its sub-brand Koodo announced the support eSIM in Canada. The supported list of phones includes the iPhone 11 series and XS series, Google Pixel 3a and 4 series, Motorola Razr and Samsung Galaxy Fold. Among other devices such as smartwatches, laptops, and tables, the Samsung Galaxy Watch Series, Apple iPad Pro 11-inch, and Surface Pro X support the eSIM functionality offered by Telus and Koodo.
The plans related to eSIM becoming significantly cheap in the region and a secure international roaming solution considerably drive the adoption of eSIM in the region. On phones with eSIM support, the user can select from a bunch of individual countries or roaming plans, where the multi-country operators tend to be significantly more expensive than US Mobile’s solution. If the user is traveling abroad, he can select the carrier’s roaming plan. On AT&T and Verizon, that’s generally USD 10 per day for high-speed data. Otherwise, the user can still buy a local SIM card or use a multi-country travel SIM card like KnowRoaming, which tends to be the most expensive. eSIM lets the user scan a QR code or pick a new carrier from an on-device menu, making it much easier to switch carriers or roam. esim market