Thanks to MEXT for hosting the Consumer Electronics Day Online Event on November 23rd 2022. Oasis had the opportunity to be a speaker and discuss the future of digital Experiences of Telecom
Access new experiences digitally
Before we start to discuss eSIM, consider what these four major brands have in common: Airbnb, Netflix or Amazon (apart from the fact they all didn’t exist 20 years ago!)
The answer is that all these products are designed to allow users to access new experiences digitally and they make the life of the consumer easier for example when they want to shop, watch a movie or go on holiday. They also are designed to save the consumer money.
At Oasis we believe that there are new ways of delivering connectivity that could benefit you in the same way as the business models used by the companies above. For example, if you were catching a plane, then you might want instant connectivity when you land in your new destination, or maybe you didn’t set up a connection on arrival, but the apps you use when travelling, like a mobility app, will have an embedded offer for connectivity that you can download. It doesn’t, however, have to be just for international travel, other examples include those who use laptops with embedded connectivity on trains or families who use multiple devices during a car journey can all connect via one hotspot.
What we see in these examples is that connectivity must adapt to our new lifestyle. The reality however is that we are still someway behind in matching current consumer demands. One of the reasons for this is the continued reliance on plastic, or rather physical plastic SIM cards. To put this in context there were 8.6 million cards sold in Q2 2022 and in the year as a whole 2.6 billion in consumers and IoT devices. In contrast, eSIM devices, which offer this seamless connectivity, have seen only 41 million transactions this year.
eSIM is catching up
eSIM however has the capability to enable these consumer trends. eSIM is the digital delivery of a SIM over the air, completely removing the need for a physical SIM card. As you can see above the sales of eSIM devices are lagging behind physical SIM, this gap is however closing. More than 250 operators globally have implemented eSIM and it is now available in more than 88 countries, this includes most of the major markets. This is due to operators realising they can’t just provide physical SIMs anymore and must invest in eSIM as a digital asset. According to a GSMA survey, this change was likely brought on by the understanding to provide consumers with new digital services and that the physical sim slot within phones is likely to disappear in future models.
The problem, for now, is that consumers have limited knowledge of eSIM, in fact, less than 30% are even aware of eSIM. The uptake of knowledge has also been slow. From 2020 and 2021 only a 5% growth was measured in the rate of knowledge of eSIM. If we look at some isolated markets in Europe, knowledge of eSIM stood at 30% in Italy, 20% in France, and 14% in the UK. This means a lot of people who could have access to this technology and enjoy seamless connectivity don’t know about it. Interestingly when the GSMA conducted the survey they found 15% of those with knowledge has gained this knowledge from buying a new device, rather than hearing about it from the operators.
As eSIM-enabled devices become more commonplace and widely purchased within the market we can expect this to grow. This acceleration can be seen in the United States where Apple recently announced the first eSIM-only device will be available, which will in turn provoked a major change in operators with Verizon, the biggest network in the states, announcing they will allow SIM technology to test drive their network for free.
Looking to the future
Looking to the future, the devices we can expect to hit the market, that will have this connectivity technology, will primarily be smartphones. In 2022 61% of the devices currently in the market were smartphones, followed by smartwatches, connected cars and drones. More and more of these devices will be eSIM enabled in the coming years, with figures expected to hit around 3.5 billion by 2025.
The price of the technology will also become more appealing to consumers. This year the first eSIM device below $400 hit the market and these price points are expected to fall moving forward. We can also expect to see some devices which were not originally designed around connectivity or customer experience start to embrace the technology. The connected vehicle is a prime example of this. Connected Cars are a great use case for eSIM due to their mobile nature, they can be difficult to get to connect to wifi or satellites.
With eSIM however, connectivity becomes much easier, even if the car is moving between providers or countries. Counterpoint Research believes that 100% of newly built connected cars will be eSIM compatible by 2030. These connected cars will transform the consumer experience, with the improved connectivity revolutionising navigation systems while steaming and gaming become available as part of the entertainment systems.
At Oasis we believe that, in the same way those major companies mentioned at the start have allowed customers to enjoy new digital experiences with seamless connectivity, eSIM with its native, seamless over-the-air instant connectivity is another of these innovations to embrace.
We would like to thank MEXT for inviting us to speak at their Consumer Electronics Day 2023, you can find out more about the event and upcoming MEXT events here.
About Oasis Smart SIM
Established in 2011, Oasis Smart SIM is a France and Singapore-based company simplifying Telcos, Service Providers and OEMs’ adoption of eSIM by providing a range of GSMA-certified eSIM infrastructures, platforms and services designed to simplify technology. Oasis Smart SIM is now a member of the GSMA and TCA (Trusted Connectivity Alliance), ranked by Counterpoint Research as the 6th Global eSIM Management Solution Provider in 2022.
Oasis Smart SIM is a subsidiary of Tata Communications Limited, a digital ecosystem enabler powering today’s fast-growing digital economy.