5G and eSIM are now a must for IoT companies

Embedded Subscriber Identity Module (eSIM) technology was introduced more than a decade ago. While it did not become the disruptor of the communications and telecommunications industries that many predicted, it eventually found success through the Internet of Things (IoT).

However, over the past 12 months or so, both the IoT and eSIM industries have seen huge growth and adoption by leading companies in the sector. Research from analyst Omdia suggests this growth will continue as both become entrenched in the enterprise.

The Omdia IoT Enterprise Survey analyzed the views of 506 IoT companies. The study found that IoT deployment plays a vital role in the digital transformation strategies of many companies, bringing benefits such as increased productivity, cost savings and achieving environmental sustainability goals. As a result, companies continue to increase spending on IoT solutions and widely expand deployment.

Omdia’s survey results show that enterprises are deploying or in the process of rolling out IoT solutions, with 95% of respondents expecting to see measurable benefits from IoT within two years of deployment. The results also show that while LTE (4G) remains a popular connectivity carrier, more than 70% of enterprises plan to use 5G connectivity.

At the same time, eSIM and related iSIM technologies have been or will be adopted by nearly 90% of enterprises in the next two years. This technology will enable enterprises to better manage costs and allow them to renegotiate future connection tariffs.

Looking ahead, Omdia noted that the survey results show a very positive growth in the deployment of IoT solutions, which indicates a positive ripple effect for players across the IoT value chain, but competition will intensify. Given that deploying IoT solutions is often complex and requires multiple skills to succeed, companies are increasingly relying on suppliers and partners. Many companies see acquiring relevant resources and skills internally as a major obstacle.

“While some tech giants have scaled back their IoT efforts, enterprises are embracing IoT and seeing significant results,” said John Canali, lead analyst for IoT at Omdia and author of the report. “In fact, enterprises are very forward-thinking in adopting new technologies such as 5G, fixed wireless access [FWA], and eSIM/iSIM technology.”

Andrew Brown, IoT practice leader at Omdia, added: “Our survey shows that there are a lot of opportunities from hardware to software to connectivity to services.”

“However, security remains a top concern for enterprises and vendors must be able to not only provide secure products and services, but also integrate effectively into a wider solution. Vendors that fail to provide secure solutions will find themselves excluded from this growing market.”