There’s been a lot of hype around the embedded SIM (eSIM), specifically around when it finally will be incorporated into cellular handsets, and IHS Markit doesn’t see it coming from Tier 1 suppliers like Apple, Samsung and Huawei until 2019.
Rather, eSIM incorporation is likely to happen first with Tier 2 and 3 handset suppliers as part of small-scale introductions to test the market, according to IHS technology analyst Don Tait. At the time of his report, there were no eSIMs in smartphones with telecom functionality.
Still, Tait said in his blog that the eSIM market is on a trajectory to increase nearly nine-fold, from a relatively small base of 108.9 million shipments in 2016 to 986 million shipments in 2021, according to IHS’ latest research.
Most of the initial growth is in the non-handset environment, with wearables, consumer electronics and Internet of Things (IoT) devices, where eSIM can be more easily incorporated without dealing with legacy issues.
Neither Apple nor Huawei responded to a request for comment on their eSIM plans, and a spokesperson for Samsung told FierceWirelessTech that the company doesn’t comment on rumors or speculation.
The GSMA announced at the Mobile World Congress in March 2015 that it was working with mobile network operators, mobile device manufacturers and SIM vendors to create a common, global specification for remote over-the-air provisioning and management of connectivity to consumer devices. The standardization of eSIMs is taking place in phases within the GSMA, with a third phase expected later this year.
Currently, few real eSIM devices exist beyond machine-to-machine implementations, some variants of Apple’s iPad Pro and a few smartwatches, noted CCS Insight analyst Raghu Gopal in a blog post earlier this year.
Microsoft announced in 2016 that its platform would provide native support for the eSIM specification, and Gemalto teamed up with Microsoft to bring embedded SIM technology to Windows 10. But smartphone makers appear to be waiting for the completed standard from the GSMA.
Tait said the removable SIM card is not going to die out and be replaced overnight. However, the proportional importance of the removable SIM will decline over time, from 5.4 billion shipments (98.0% of the total) in 2016 to 5.1 billion (83.9% of the total) in 2021.
The benefits of the eSIM for consumers include an improved experience with greater flexibility, an increase in the number of connected devices and lower costs of connected products. For network operators, it can lead to reduction in SIM handling, integration and handling costs, and for the SIM card suppliers, it can result in new market opportunities in IoT, M2M and the connected car, Tait said.
Source: Fierce Wireless