Embedded SIM – an evolution not a revolution

May 29, 2016

Blog

Jean-Christophe Tisseuil, Head of SIM Technology, GSMA

Photo Jean-Christophe Tisseuil Head of SIM Technology GSMASIM cards – in all their sizes and form factors – have played a major role in the success of mobile communications. They have ensured a secure way for users to authenticate their mobile devices to the network and ensure privacy of their communications; they are removable so allowing users the choice of service providers and devices; they have been adopted all over the world by vendors and operators, allowing a global market to develop.

We are now at a stage where an even smaller SIM is needed to support a new wave of connected and wearable devices. With an embedded SIM, soldered onto the hardware, a device can be made smaller or have more space available for a larger battery. Without needing a SIM slot, it can be more easily waterproofed.

Enabling new devices

At MWC16 we saw varied examples of connected devices that would benefit from having an embedded SIM such as drones, bikes and the Deutsche Telekom’s connected teddy bear. The most common example of a connected device that would benefit from a cellular connection is the smart watch.

Berg Insight estimates that 11.5 million smart watches shipped in Q1-Q3 2015, nearly treble the previous year, in a sign that there is demand for this new segment. I believe that smart watches with cellular– such as the Samsung Gear S2 – rather than just WiFi, will have much greater appeal as they no longer need to be tethered to a smartphone. That’s a big advantage to a runner, for instance.

It’s not just the consumer device manufacturers that may see the opportunity here. Sportswear brands like Nike, Adidas, Under Armour and Speedo have launched wearables and apparel, and fashion brands like Guess and Fossil as well as luxury brand such as Tag Hauer have released smart watches and Ralph Lauren a biometric t-shirt. Cellular could make these devices even more desirable.

Importance of common ground

The embedded SIM would have developed without standards or common specifications but the danger would have been fragmentation and inflexibility. For instance, an OEM could hardcode an operator profile onto the embedded SIM in a factory. But this device would forever be locked to one network and the OEM would need to do this for every operator in every country.

To ensure that this did not happen, the GSMA brought together 40 major players from across the industry to agree a specification which would allow the operator profile to be downloaded over the air rather than hardcoding during manufacturing. This was an essential feature.

By downloading OTA, it means users could select their own service providers independently of the device; operators could simplify their supplier chain and move subscription management online; OEMs would not need a device per operator. Other blogs explore these benefits (LINK)

What made this harder was the need to create a provisioning process for devices that may not have a graphical user interface – such as the connected teddy bear or a bike lock or security alarm.

We believe that with the GSMA Remote SIM Provisioning specification we have created a process which ticks all of the boxes. For consumers, there is a simple process for connecting a new device using a QR code and a companion device (see how it is done here). Operators can be assured the embedded SIM is every bit as secure as a removable SIM, and can offer customers a single plan for multiple devices. And OEMs now have a global specification which they can use to bring devices to market rapidly.

Evidence of this is how quickly RSP is being adopted. In Germany, both Vodafone and Telefonica are launching dedicated plans for the Samsung Gear 2 which contains an RSP-compliant embedded SIM. We expect to see many more devices with embedded SIM launch this year and operators around the world will be connecting them.

Combined with the embedded SIMs in industrial devices and a soon-to-be released specification for handsets, RSP will play a major role in driving embedded SIM adoption. Machina Research estimates that by 2020 there will be 125 million embedded SIM connections worldwide, or 16% of all connections. Commercially, this could be worth up to $174 billion annually to operators in 2020.

Jean-Christophe Tisseuil is Head of SIM at GSMA leading the Remote SIM Provisioning for Consumer Devices Programme. Previously Jean-Christophe was Vice President Strategy Telecoms at Morpho, e-Documents Division responsible for field marketing, innovation and M2M business development. Previously he was also responsible for Product strategy and marketing for SIM cards at Orange Group.

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