EDITORIAL: eSIM, an advanced technology for new innovations

MTN Nigeria Plc (MTN) recently announced the trial of Embedded Subscriber Identity Module (eSIM) services on their network based on approvals received from the Nigerian Communications Commission (NCC).

This move is part of MTN’s continued drive to lead digital transformation, foster inclusion, improve customer experience and maintain the highest quality of service for her customers.

In a report published in October 2018, Thalesgroup.com reported that the most recent generation of flagship phones and smartwatches works with the revolutionary remote connectivity management solution enabled by Gemalto.

“eSIM around the world” is becoming a reality that will enable millions of consumers to seamlessly provision and activate a mobile subscription and connect their favorite devices anytime, anywhere. With 3.5 billion devices on the market by 2025, cellular connectivity will play a major role in bringing massive IoT to life both on the consumer and M2M markets, exponentially increasing the number of mobile connections. Gemalto has deployed more than 100 eSIM remote subscription management platforms to mobile operators, operator alliances, MVNOs, car manufacturers and OEMs across all continents, the report reads.

What is eSIM?

Embedded SIM (eSIM) or Embedded Universal integrated circuit card (eUICC) is a non-removable SIM/hardware for next-generation connected consumer devices.

In a recent post, Gemalto pointed out that it is mandatory for eSIMs to be compliant with GSMA’s Remote SIM provisioning specifications.

eSIMs finds applications across a broad spectrum of consumer devices such as smartphones, laptops, wearable, smart glasses, tablets, printers, connected home devices, and several other gadgets.

There are various advantages offered by Embedded SIM (eSIM) such as high-quality connectivity, easy management of subscription over the entire lifecycle of the device and simplified logistics.

Major Key Players of the eSIM Market are:

• Gemalto NV
• Giesecke+Devrient GmbH
• Infineon Technologies AG
• STMicroelectronics
• Workz Group
• Truphone Limited
• NXP Semiconductors
• Sierra Wireless
• Valid
• Plintron

The growing adoption of eSIMs by device manufacturers, operators, and consumers can be attributed to several factors such as remote provisioning of user profiles, enhancement of end-users’ experience, differentiation of device offerings and the ability to remotely manage multiple customer subscription simultaneously, among others.

The likely issues to redefine the market

• Moreover, design flexibility due to the small footprint of e-SIM facilitates new technology adoption by device manufacturers.
• Reduction in size provides device manufacturers with additional flexibility, in terms of lowering production costs while not compromising on features.
• However, hacking & changing eSIM profiles pose challenges to eSIM market growth.

eSIM Market by device:

Based on device, the eSIM market is segmented into connected

• cars,
• smartphones,
• wearables, and
• others

In 2019, the connected cars segment is estimated to account for the largest share in the global eSIM market.

The large share of the connected cars segment can be attributed to extensive initiatives by governments for the promotion of electric vehicles.

In addition, the features offered by eSIMs, such as self-diagnosing cars, improving traffic conditions, advanced emergency systems, simplified logistics, secured connectivity, higher reliability, optimal 5G support, and improved user experience, are expected to propel the growth of this segment.

eSIM market by end use industry:

Based on end-use industry, the market can be segmented into:

• automotive,
• consumer electronics,
• energy & utilities, and
• others

In terms of market share, the consumer electronics segment is estimated to account for the largest market share in 2019 owing to the increasing adoption of eSIMs in consumer electronic devices such as smartphones, laptops, tablets, wearable devices, and others.

eSIM market by region:

The global eSIM market can be segmented into North America, Europe, Asia Pacific, and the Rest of the World (ROW).

Africa actually is among segmented as ‘the Rest of the World’. Interesting! In terms of market share, Europe dominated the eSIM market followed by North America and Asia Pacific.

Gemalto has predicted that Europe will continue to dominate the global eSIM market during the forecast period owing to factors such as increasing use of eSIM for a wide range of applications, rising government initiatives to promote its adoption and launch of a wide range of technologically-advanced products in this region.

For instance, in April 2018, built-in connectivity has been a specific requirement in Europe following the Emergency Call (eCall) initiative intended to bring rapid assistance to motorists involved in collisions anywhere in the European Union.

However, Asia Pacific is expected to witness the highest CAGR, with market growth centered in China, Korea, Japan, and India.

On accounts of rising population and the growing adoption of smartphones in economies, such as China, Japan, and India, the region is likely to witness extensive adoption of embedded SIMs in the coming years.

But, with the MTN’s launch of the West African first trial of eSIM, experts at Gemalto may need to revisit their predictions.

We understand that “more than 900 million eSIM-compliant devices are expected to be shipped yearly by 2022”, thus, Africa should not be seen as incapacitated!

We support the eSIM adoption because of the expected useful for people who want to manage personal and business lines easily and effectively or want a separate profile for data.

The new technology will also be extremely convenient for frequent travelers and tourists, making it easier for them to opt for and keep a local subscription when visiting Nigeria.