eSIM is making a big splash in the IoT space, but it’s not yet seen on mobile phones

Recently, Beijing Mobile officially launched the "One Number, Dual Terminals" service, and eSIM has once again attracted everyone's attention.

With the development of 5G and the Internet of Things, eSIM technology has been rapidly implemented in the field of the Internet of Things. However, the progress of the three major operators is different. At present, China Telecom and China Unicom have realized the eSIM wearable device one number two terminal service and have expanded it to the whole country, while China Mobile is still launching it in one city after another.

However, eSIM has not made much progress in mobile phones. In the past few years, the industry was still discussing whether eSIM would replace SIM. Now it seems too early to say that it will replace SIM.

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eSIM has great development in the field of Internet of Things

eSIM, or embedded SIM card, embeds the traditional SIM card directly into the device chip. Users can directly access the wireless network services provided by the operator without inserting a physical SIM card.

IoT eSIM will be widely used in various fields such as wearable devices, Internet of Vehicles, Industrial Internet, smart cities, etc. According to Strategy Analytics' forecast, eSIM sales for IoT applications will grow to US$326 million in 2025.

At present, consumer electronics, machine-to-machine (M2M) communications, and the Internet of Things (IoT) will be the three main application scenarios of eSIM.

Market research firm ABI Research predicts that by 2024, the number of consumer electronic devices with built-in eSIM will reach 644 million, of which about 500 million will be smartphones. In the field of M2M and Internet of Things, the number of eSIM devices is expected to reach 232 million by 2024 (with an annual compound growth rate of 18%), of which more than 100 million will come from automobiles.

In China, in October 2020, the Ministry of Industry and Information Technology issued a document agreeing that China Telecom and China Mobile would carry out eSIM technology application services in the Internet of Things and other fields nationwide.

Currently in the chip field, eSIM has made great progress.

Unigroup Guoxin's eSIM chips have been used in some smart connected terminals, and it has developed a "super eSIM" chip. It is understood that Unigroup Guoxin's super eSIM fully supports all GSMA (Global System for Mobile Communications Association) standards from 3G to 5G, adopts the world's advanced manufacturing process, improves performance by 30%, has the characteristics of high security, high reliability, and large capacity, and supports the new business form of "one number for multiple terminals". In terms of packaging, it supports a variety of sizes such as 5*6mm, 3*3mm, 2*2mm SMD packaging and smaller WLCSP packaging, which can be applied to different types of terminals and application scenarios.

Infineon also has a complete eSIM product portfolio, suitable for consumer, industrial and automotive applications, which can meet the needs of different applications. For example, in the field of Internet of Things, it has security controllers for industrial applications, including SLM76, SLM97, and SLM17; in the field of automotive applications, it has security controllers SLI76 and SLI97 for automotive applications.

China Telecom and China Unicom have already launched the service nationwide, while China Mobile is still in the process of "attacking the city"

However, the progress of the three major operators is different. Currently, China Telecom and China Unicom have realized the eSIM wearable device one number dual terminal service and have expanded it to the whole country, while China Mobile is still opening it in one city after another.

China Mobile announced the official launch of its "eSIM One Number, Two Terminals" service in June 2018. Through the "One Number, Two Terminals" service, users can bind their mobile phones and wearable devices and share the same number, call charges and data packages. The eSIM service pilot was launched on January 23, 2019, and the pilot was launched in seven cities including Tianjin, Guangzhou, Shanghai, Nanjing, Hangzhou, Shenzhen and Chengdu.

Currently, China Mobile's one number, two terminals service can use the eSIM function on Apple Watch. Supported regions include Beijing, Guangdong, Gansu, Jiangsu, Jilin, Liaoning, Shanghai, Sichuan, Tianjin, and Zhejiang. Some cities in the above provinces and cities can already apply for eSIM.

In addition, the eSIM service pilot cities have entered formal commercial use. Shanghai Mobile started charging in September 2020, and Guangzhou Mobile started charging in January 2021. Currently, the standard rate is 10 yuan per month.

China Unicom has been conducting pilots for eSIM wearable independent numbers and one number dual services in six provinces and seven cities since March 2018, becoming the first operator in mainland China to launch eSIM services. It also launched the eSIM wearable independent number service nationwide on March 29, 2019, and currently has more than 500,000 smartwatch users who have activated the eSIM service. On December 20, 2019, the Ministry of Industry and Information Technology officially approved the launch of a nationwide service trial for China Unicom's eSIM wearable device one number dual terminal service. So far, China Unicom has become the only operator in China to launch a nationwide service trial for eSIM independent numbers and one number dual terminal dual services, and is also the world's first operator with an eSIM management platform with independent intellectual property rights.

Starting from January 1, 2020, China Unicom's eSIM wearable device one number two terminal service will be gradually expanded from the pilot to the whole country. On February 26, 2020, China Unicom and Fibocom jointly released the world's first 5G+eSIM module.

In December 2018, China Telecom also launched the eSIM one number, two terminals service in Shanghai, Guangzhou, Shenzhen, Nanjing, Wuhan, Chengdu and Hangzhou. Currently, the eSIM service has been launched nationwide and users can apply for it in the online business hall.

It’s too early for eSIM to replace SIM

After many iterations, the size of the mobile phone SIM card has been reduced from the standard card size to the current 12.3×8.8mm. However, as an information carrier, the size of the nanoSIM card is still not proportional to the size of its internal chip. Therefore, the eSIM card is the future development trend.

However, eSIM has not made much progress in mobile phones. Industry insiders said that since eSIM is embedded in the terminal, once the eSIM fails, it is basically impossible to repair it and the only option is to replace the terminal. From this perspective, it is not as convenient and safe as traditional SIM cards.

Moreover, eSIM is not as simple as designing and manufacturing a chip. It involves the coordination and support of a whole set of systems and processes, which takes a certain period of time to gradually realize. Operators also have to invest huge amounts, including platform construction and system transformation.

A few years ago, the industry was still discussing whether eSIM would replace SIM. Now it seems that it is too early to say that it will replace SIM.