The eSIM revolution is transforming international connectivity—and challenging traditional roaming revenue streams. Yet mobile network operators (MNOs) possess intrinsic advantages that position them to adapt and thrive in this new paradigm.

For nearly two decades, the smartphone has digitised once-physical tools—cameras, calendars, clocks, maps, and music players. The SIM card, a historically indispensable but removable component, is now following that trajectory toward virtualisation.

A foundational component of mobile identity, the SIM card stores an International Mobile Subscriber Identity (IMSI) and associated encryption keys, enabling subscriber authentication on the cellular network. Since its debut in 1991, the SIM’s physical form has been a plastic card inserted into handsets—a design unchanged until the 2016 debut of the embedded SIM (eSIM).

This new iteration, the eSIM, is permanently soldered into devices, relies on an embedded Universal Integrated Circuit Card (eUICC) capable of storing and managing multiple operator profiles. End users can seamlessly switch providers by scanning a QR code or using an app—no physical handling required.

Google launched its first eSIM-compatible handheld device, the Pixel 2, in 2017. The following year, Apple supported eSIM for iPhones. According to GSMA Intelligence, there are now more than 271 eSIM-enabled consumer devices available. Analysts believe that 56 percent of smartphones will be eSIM-enabled by 2028.

When introduced, eSIM sparked both concern and excitement in the industry. Would easier switching undermine the MNO’s market power, or open doors to new models? Nearly a decade later, the most profound disruption is undeniably occurring in travel and roaming.

Travel Roaming: The eSIM Battleground

The reasons behind this disruption are clear. For international travellers, downloading a travel eSIM is more convenient and typically cheaper than traditional roaming or inserting a local SIM card. Juniper Research projects the number of travel eSIM users will rise from 40 million in 2024 to more than 215 million by 2028—a staggering fivefold increase.

Thales’ historical framing of eSIM is accurate. Initially designed for IoT—where physical access to devices is often impractical—eSIM enabled manufacturers to install profiles remotely post-production. This use case justified its industrial rollout.

However, it was inevitable that the consumer sector would adopt this innovation. Google pioneered support with the Pixel 2 in 2017, quickly followed by Apple. GSMA Intelligence now tracks over 271 eSIM-enabled consumer devices, with forecasts suggesting that by 2028, more than half of all smartphones (56%) will support eSIM.

Why Travel Is the Epicentre of eSIM Adoption

Few markets are as ripe for disruption as travel. Kaleido Intelligence anticipates a 500% increase in global travel eSIM spend between 2023 and 2028, reaching $10 billion. The drivers are straightforward:

1. Price Advantage: Roaming rates remain high—$8.57 per GB on average—compared to travel eSIM data priced at around $5.50 per GB. This price gap matters, particularly in price-sensitive markets.
2. Price Transparency: Unlike unpredictable roaming charges, travel eSIMs offer upfront pricing—minimising ‘bill shock’ and aligning with consumer expectations for cost control.
3. Continuity of Number: Travel eSIMs allow users to maintain their primary number or access new connectivity without removing their primary SIM, a flexibility physical SIMs cannot offer.
4. Ease of Use: Instant activation via app or QR code is vastly simpler than locating, buying, and configuring a physical SIM in a foreign country.

From a strategic standpoint, Thales rightly identifies travel as the critical domain where eSIM is shifting the competitive landscape. But the implications run deeper. Roaming has long been a high-margin revenue source for MNOs. With consumer behavior now favoring travel eSIMs, operators must either innovate—or risk irrelevance.

Can MNOs Compete—And Win?

Despite new entrants and a fast-moving market, MNOs are not without leverage. In fact, they have several structural advantages:

• Brand Trust: Consumers are cautious when dealing with unfamiliar providers abroad. MNO brands—established and regulated—offer reassurance.
• Global Roaming Partnerships: Existing inter-operator agreements can be repurposed for eSIM packages, often with better data pricing through volume negotiation.
• Marketing Firepower: With established advertising channels and expertise, MNOs can outpace startups in brand awareness for eSIM offers.
• Value-Added Partnerships: Bundling eSIM offers with local transport, attractions, or hospitality partners could enrich the user experience while unlocking new revenue streams.
• Local Customer Support: Retail outlets and local affiliates provide hands-on assistance for troubleshooting—something over-the-top (OTT) providers can’t replicate at scale.
• Voice and SMS Services: Only MNOs can offer true cellular calling and SMS natively—still crucial in jurisdictions with VoIP restrictions or where authentication via SMS remains essential.
• Regulatory Compliance: From eKYC to data privacy, MNOs already navigate complex local requirements—giving them an operational edge that startups must often build from scratch.

Thales’ analysis here is balanced and credible. Bouygues Telecom’s B&YOU Summer Edition works in 112 destinations, Orange Flex covers over 200 countries, while Vodafone’s Travel eSIM service works across 700 networks worldwide. With roaming reshaped by consumer demand, operators who remain passive will cede share to faster, more agile players.

Strategic Options: Build, Partner, or Buy?

As MNOs evaluate how to enter or scale in the travel eSIM market, Thales outlines three viable strategies:

• Build: Developing a bespoke platform offers integration with existing systems but is slow and capital-intensive. The long development cycle may also delay time-to-market, critical in a competitive space.
• Partner: Collaborating with an existing eSIM provider offers a fast track but limits flexibility and locks the MNO into another party’s roadmap and pricing model.
• Buy (White-Label Platforms): This increasingly popular option combines speed, control, and scalability. Platforms like Thales Travel Connect allow MNOs to launch with minimal delay while maintaining branding and ownership of the customer experience.

From an industry standpoint, the third path is the most pragmatic for many MNOs. Leveraging white-label infrastructure ensures fast market entry without the technical overhead of building in-house.

Final Thoughts

Consumer eSIM has had its most profound impact in the travel sector—redefining roaming. But while startups and digital-native brands have led the initial surge, traditional MNOs are far from out of the game.

Their infrastructure, regulatory expertise, local presence, and brand recognition offer a competitive moat. When combined with scalable platforms like those from Thales, MNOs are well-positioned to launch differentiated, omnichannel eSIM services that appeal to both outbound and inbound travellers.

The travel eSIM opportunity is no longer theoretical—it’s unfolding now. For operators, the challenge is no longer whether to act, but how fast they can do so.