Electronic SIMs or eSIMs are becoming an essential part of both consumer and enterprise electronic devices

John Canali, Omdia Principal Analyst, IoT

February 27, 2024

2 Min Read
ESIM card chip sign. Embedded SIM concept.
Getty Images

From the network side, 5G continues to evolve and communication service providers are looking to leverage the advantages of 5G standalone networks including massive IoT, reduced capacity and network slicing. While these will be major drivers of the IoT market, it is arguable that significant developments in subscriber identity modules (SIM) technology will prove to be an even greater catalyst of growth. 

IoT devices can differ greatly from devices like smartphones and tablets, in that they have limited computing power, often the devices are just sensors and limited battery life, they are not intended to be charged daily. IoT devices often differ greatly from one another in terms of sophistication and applications, often the SIM is the only standardized part. 

Electronic SIMs or eSIMs are becoming an essential part of both consumer and enterprise electronic devices. They empower the end user with the ability to change networks remotely, whereas physical SIMs would need to be manually changed. For enterprises, devices can be manufactured with an eSIM, and the network can be selected once the device is deployed. Enterprises can better manage device connectivity and the associated costs over the lifetime of the device and even switch carriers if more advantageous tariffs are available. Enterprises can also create a more complete or reliable network, even when devices are deployed across many geographies. The eSIM is also a useful tool for regulatory compliance in markets that do not permit permanent roaming. 

Through the efforts of the Global System for Mobile Communications Association (GSMA) and its members the SGP.31/32 specifications help to address the growing needs of enterprises deploying IoT devices. The emergence of an eSIM for IoT will address though not fully rectify difficulties in deploying eSIMs in low-power, wide-area networks (LPWAN) and catalyze the deployment of devices such as smart meters. Enterprises can create not only more robust networks but also plan the devices’ life cycles against the longevity of 5G networks. As the GSMA improves its standards and other vendors with proprietary solutions to address inefficiencies in the interface come to market, we believe that the market for eSIMs in IoT will be further catalyzed. 

Read more about how eSIM technology is bringing greater efficiency to the cellular IoT market in new research from Omdia >>>

About the Author(s)

John Canali

Omdia Principal Analyst, IoT

As part of Omdia's Internet of Things (IoT) practice, John is based in Boston. His specialist areas of coverage include service provider IoT strategies, IoT platforms, IoT product and go-to-market approaches, and key IoT vertical markets, including connected cars.

Prior to joining the Omdia (formerly Ovum) IoT team in 2019, John spent over five years working in product management and product development with AT&T's IoT organization. He provided commercial and market support in areas including connected cars, fleet solutions, smart cities, and smart homes. Before joining AT&T, John was an analyst with Strategy Analytics, focusing on connected car markets, technologies, and opportunities. John holds a Bachelor of Arts in economics from Trinity College in Connecticut and a Master of Science with distinction in international strategy and economics from the University of St Andrews in Scotland. 

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