Overcoming practical & economic issues for mid-term consumer-market eSIM adoption. Published August 2016
Disruptive Analysis has published a 36-page report on the emerging technology of eSIM and SIM remote-provisioning. The focus is on the use-cases, practicalities, drivers and obstacles for bringing eSIM-based devices to market, alongside suitable mobile data plans or subscriptions.
The report addresses both the motivations (lower costs, higher revenues, better experience) and problems (business-case, user journey, regulation, transition) that will be experienced by operators (MNOs) and device vendors (OEMs).
Forecasts are given for annual shipments of eSIM-enabled devices (phones, wearables, M2M, tablets), and for the installed base that will be a target for after-market eSIM provisioning.
- There are numerous use-cases for “remote provisioning” of SIMs with mobile operator “profiles”, especially where the SIM hardware is built-into devices
- eSIM adoption will have a slow start. 2016-17 consumer deployment will mostly be early concepts, allowing MNOs and OEMs to gain practical eSIM experience and refine implementation and processes. eSIM phones will emerge very gradually.
- Adoption should ramp up in 2019-2021 as cost, industry value-chain and user-experience problems are progressively solved.
- Apple and Samsung are unlikely to use eSIM to become MVNOs / carriers. Neither will they aggressively push eSIM into their flagship products.
- For many M2M/IoT devices, the eSIM decision is secondary to justifying the extra cost, space and power needs of the cellular radio itself.
- eSIM is "necessary but not sufficient" to drive adoption of cellular M2M. It is unlikely to change the competitive dynamics vs. LPWAN technologies like SigFox or LoRa.
- There remain unanswered questions about regulation, customer-support and business model for eSIM. Although some projected cost-savings are attractive for operators, it is unclear that it will help OEMs generate extra revenues/loyalty.
- There will other approaches to remote provisioning beyond GSMA's vision of eSIM. Some OEMs may adopt proprietary versions, while standards-body ETSI is intending to develop specifications which go beyond just mobile use of chip-cards
- Most eSIM-enabled smartphones will be hybrid eSIM / removable-SIM.
- By 2021, 630m mobile & IoT devices will ship with embedded SIMs annually, driven mostly by smartphones, although vehicles and tablets show growth earlier.
- By end-2021, the installed base of eSIM-enabled devices will exceed 1 billion
- While significant, this only represents around 10% of total cellular connections
In a nutshell: eSIM is an important evolution for some use-cases, but it is neither an outright "game-changer" nor a major risk to traditional cellular business models.
To purchase the report, see below
Introduction & Outline
What is eSIM / eUICC?
New uses for eSIM & other programmable-SIM technologies
A device-centric view of SIM provisioning
A growing variety of “SIM evolution” options
Economics and demand
SIM/eSIM irrelevant if radio module costs too high
Retail and channel management
Maintenance and lifecycle-management
Transition issues: the need for hybrid SIM + eSIM devices
Ecological considerations: fit with other telecoms trends
Low-end vs. high-end phones
Conclusions and Forecasts
About Disruptive Analysis
Figure 1: Understanding the definition & semantics of “eSIM”
Figure 2: Advantages of “programmability” vs. “embeddability” varies by device
Figure 3: SIM evolution – multiple variants are emerging, not just GSMA eSIM
Figure 4: SIM evolution – costs and key stakeholders
Figure 5: Few handsets’ gross margins can sustain extra BoM cost from eSIM
Table 6: Forecast eSIM shipments, by device category, 2016-2021
Figure 7: eSIM shipments, by device category, 2016-2021
Figure 8: eSIM device shipments, hybrid SIM/eSIM vs. eSIM-only
Table 9: eSIM active installed base, by device category, 2016-2021
Figure 10: eSIM installed base, by device category, 2016-2021
Figure 11: Overall SIM & eSIM active installed base, end-2021
Ordering & payment
The report (delivered as a PDF) costs:
US$900 for a 1-3 user licence
US$1500 for a corporate-wide licence + a free 1-hour conference-call discussion
(plus VAT in UK/EU as appropriate)
PLEASE NOTE - DISRUPTIVE ANALYSIS IS CLOSED BETWEEN 20/12/2016 & 5/1/2016. ANY ORDERS IN THIS PERIOD WILL BE FULFILLED IN JANUARY.
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