espite significant progress in the commercial availability of embedded subscriber identity module (eSIM) devices and associated connectivity services, consumer awareness of eSIM still remains low, with Sub-Saharan Africa showing the lowest adoption rate globally.
This is according to “The Mobile Economy 2021” report, based on research conducted by the GSM Association (GSMA). The study provides an overview of the global telecoms landscape and the key mobile trends shaping the industry, as well as future forecasts.
eSIM is a digital SIM that allows users to activate their tariff plan from a carrier without having to use a physical SIM. It uses a small chip to authenticate a user’s identity with their carrier, as part of a global specification developed by the GSMA telecoms trade body.
It offers numerous benefits for consumers, the most significant of which is the ability to change network providers more readily.
The report notes that operators increasingly see eSIM as an enabler of new revenue streams and further digitisation for consumers.
At least 175 mobile service providers had launched commercial eSIM services for smartphones across 69 countries by the end of 2020, including MNOs, OEMs, SIM vendors, network vendors, semiconductor manufacturers and end-user enterprises. However, uptake among consumers has been slow.
Sub-Saharan Africa shows the lowest consumer adoption and rollout rate by operators, it points out.
“eSIM service for smartphones is now available in every region; Europe (41%) has the highest number of operators that have launched commercial services, followed by Asia Pacific (25%), andMiddle East and North Africa with 13%,” notes the report.
“Regions with the lowest uptake include North America (8%),Latin America (7%), CIS (5%) and Sub-Saharan Africa (2%), representing the lowest number of launched services.”
In South Africa, MTN launched its eSIM support capability in 2019 with the Samsung Galaxy Watch, and Vodacom introduced its eSIM capability for the same device at the beginning of 2020.
MTN later expanded the eSIM capability to some of its smartphone devices.
Telkom Mobile became the latest local telco to introduce eSIM support for its customers, making its debut last month.
As mobile operators race to develop compelling 5G use cases that leverage the technology’s capabilities to support the realisation of Industry 4.0 objectives, commercialising 5G across the consumer and enterprise segments will require the right blend of partnerships, with a combination of capabilities, such eSIM innovations, being key to creating value to both consumers and businesses, notes the report.
eSIM service for smartphones across 175 countries in 2020.
In a survey run by GMSA among its OEM and operator members, the respondents rated the eSIM feature as the second highly prioritised capability within their device components, a close second after 5G, which took the highest priority. Artificial intelligence compatibility and augmented/virtual reality-based services followed.
“This highlights a growing interest in the eSIM technology, which comes as no surprise, because one of the most important benefits of eSIM services for operators is perceived to be the increased adoption of other connected devices – by linking them to a main subscription plan (typically a smartphone plan).
“In fact, on average across operators, 25% of all device unit sales to consumers are non-phone devices, including smartwatches, tablets and laptops. eSIM allows operators to add companion devices and associated cellular connectivity services to a main data plan more easily than with traditional SIMs.”
A previous GSMA Intelligence consumer-focused survey, run in 17 major markets earlier this year, found that only 20% of consumers on average were aware of eSIM – indicating that raising consumer awareness of eSIM and explaining and promoting its benefits are key to driving market adoption by operators and OEMs, it noted.
eSIM is a close second on operators’ priority lists.
Operators also pointed out they see a variety of benefits from eSIM services, spanning key operational goals on new revenue generation and cost savings.
Key highlighted benefits associated with eSIM based on how important they are to the business emerged as:
- Increased adoption of other mobile devices by linking them to a main subscription plan.
- Driving greater use of digital distribution channels.
- Enhanced customer experience by reducing the time between sign-up and commencement of service.
- Supporting international roaming services.
- Streamlining logistics costs by reducing physical SIM purchases.
- Exploring opportunities in new digital services; ie, digital identity, access authorisation and mobile payment.
“While revenue generation and cost saving remain the two main motivators for internet of things (IOT) in the mobile space, implementation plans have been hindered due to the sudden slump in economic activities and disruptions to products and services supply chains due to the COVID-19 pandemic. This has affected IOT sales volumes across multiple sectors.
“That said, there is significant upside potential in the long-term, as the pandemic has increased the urgency of digital transformation among many enterprises and demand for connected devices among consumers,” according to the report.