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eSIM and the trillion-device opportunity

New subscriber identification technology enables unique business and revenue opportunities

eSIM in logistics

Every major shift in technology opens a window of opportunity. Within the Internet of things (IoT), that window for cellular IoT technology is now open wide – with revenue estimated to near $10B by 2025. Years of specification work on cellular IoT is finally ready and network infrastructure rollouts are coming live worldwide. What lies ahead is a trillion-device opportunity, and eSIM and iSIM solutions play a critical role in driving massive cellular IoT scale.

Traditional SIM tech doesn’t scale

The success of standardized plastic SIM cards as a secure identity for cellular devices powered massive investments in cellular infrastructure. However, scale is both the biggest opportunity and biggest challenge for cellular IoT. Being power hungry and expensive, traditional SIM-based M2M modules have not scaled as widely as operators would have liked. A field service call to change SIMs in millions of such devices can be prohibitively expensive.

Fortunately, standards bodies saw the cellular IoT scaling challenge coming. 3GPP created several variants of technology under two popular categories: LTE-M, and NB-IoT. These two radio technology standards are designed to enable many more use-cases through low-power and cost effectiveness. These specifications allow dedicated lower bandwidth cellular IoT channels to co-exist on 2G, 3G, or 4G infrastructure.

Compared with the expense of all-new 5G infrastructure rollouts, cellular IoT rollouts are a no-brainer for MNOs. As of March 2019, the GSMA has identified 149 MNOs in 69 countries investing in one or both of LTE-M and NB-IoT. 22 countries including the US, Brazil, France, Germany, Belgium, Denmark, Norway, Japan, Australia, Taiwan, and others have deployments of both technologies.

eSIM provides a scalable solution for the IoT

The continued need for scalable IoT solutions led to the development of eSIM technology – an embedded version of the physical SIM card. While consumer eSIM gets headlines with certain smartphones and wearables, the GSMA developed M2M versions of the eSIM specification well before the consumer versions. eSIM, also known as eUICC, has two primary enhancements over conventional SIMs. First, eUICCs can be packaged in a chip soldered to the PCB in the device. Second, operator profiles on the eUICC can be securely and remotely updated over-the-air. Instead of swapping plastic SIM cards, profiles are downloaded and managed on a device as needed.

A push model means lower friction

Consumer and industrial (M2M) eSIMs differ in the direction of control using remote SIM provisioning, or RSP. Consumer eSIMs use ‘pull,’ where the device can initiate a profile download request. M2M eSIMs use ‘push,’ where an application owner manages profiles on many devices with RSP. Both the eUICC in the device and the RSP software are certified against GSMA specifications before the necessary digital certificates, acting as tokens of trust, are issued. This difference is important as the “push” model for M2M means the device and hence further keeping the cost down which is crucial for IoT devices.

In the eSIM model, a device is ready to deploy anywhere network coverage exists – and changing network providers is just an over-the-air profile change. If a device moves and crosses networks, its profile can be updated quickly and securely. I believe that this is pivotal for cellular IoT adoption, which in turn holds the key to reaching massive IoT scale.

New business opportunities

eSIM brings greater flexibility of managing cellular connected devices, making cellular IoT more accessible, affordable, deployable and scalable. This opens many new opportunities for the whole IoT ecosystem.

  1. Device and module makers can sell the same product anywhere in the world, without having to procure multiple variants of SIMs for every region they serve, drastically reducing manufacturing and logistical complexities. They can also send remote service updates, gather data and offer cellular enabled value-added services after the device is shipped, increasing customer satisfaction. Think security cameras that are sold with connectivity and just work out-of-box. Furthermore, device sizes and costs are reduced due to the smaller form factors and the fact that the need to stock and manage many variants of SIMs is eliminated.
  2. As an example of OEMs benefitting from this, automotive manufacturers can use eSIM-enabled cars to remotely manage connectivity over the air to vehicles switching to an operator of their choice across the entire lifetime of a vehicle. Post-issuance, they can offer a wide range of compelling services, underpinned by seamless cellular connectivity, such as real-time navigations, pay-as-you drive insurance, vehicle diagnostics, eCall and connected infotainment, as well as breakdown services and remote diagnostics.
  3. Device owners can easily manage connectivity of their devices and upgrade service plans remotely. This is a significant benefit where devices are not managed by the end user or are not readily accessible (for example, large IoT deployments spread over regions), making local device management cost prohibitive.
  4. IoT service providers can expand their reach beyond Wi-Fi and other connectivity and tap into cellular networks using LTE-M and NB-IoT technology. This avoids the need to build infrastructure and instead allows focus on customer service and innovation. 
  5. Mobile network operators will benefit from the expanding IoT customer base. Due to the robust GSMA certification, they can allow safe onboarding of devices to their networks without knowing the devices, yet still be confident that the network security and its integrity won’t be compromised.

Flexibility for bigger, broader use cases

With the scalability challenges solved by eSIMs, flexibility for new cellular IoT use cases takes over. Consider just some of the innovation possibilities:

  • Logistics providers can track assets anywhere as they cross the globe, providing greater real-time control and lowering costs. Low-power M2M modules with eSIMs can go months between battery changes.
  • Electronic item tracking benefits from reduced physical SIM tampering, and better cellular network coverage that works indoors and outdoors. Items can be easily tracked across campuses in separate cities.
  • Agriculture operations can use centralized network management to oversee facilities. Smaller, less expensive tracking devices deploy in remote settings and rugged terrain as cellular networks have very wide coverage.
  • Automotive manufacturers can handle eSIMs in their vehicles as a managed C-V2X service. Identity services such as payments, car-sharing, and more become possible. Recent enhancements to the eSIM specification for M2M services added Automatic Emergency Call and other features. Arm’s “Essential guide to GSMA eSIM certification” explores the GSMA compliance framework, multi-level certification scheme, and auditing process for vendors.

Opportunities abound in the change from a mobile-per-person model to an all-things-connected model. At Arm, we have a vision for a trillion connected devices within 15 years. Cellular IoT has a major role in at-scale deployments – if the IoT community has to address the trillion-device opportunity. For massive scale, cellular IoT devices must scale widely, automatically and securely provision to new networks and require minimal physical handling and maintenance. Arm is leading the way with two solutions for the eSIM ecosystem.

As the ecosystem adopts trusted eSIM and iSIM solutions, more possibilities will appear. With momentum behind cellular IoT, innovation will accelerate. I’m excited to see everyone take part in building the trillion-device IoT.

Need more info on eSIM and iSIM? Our eSIM & iSIM for Dummies guide provides an easy-to-understand explanation and the overview of benefits, interoperability and security.

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