Mobile network operators, mobile virtual network operators and OEMs are realising the need to shift to embedded subscriber identity module or eSIM cloud and eSIM managed solutions.
As they should. Depending on actual adoption rates, Global System for Mobile Communications Association (GSMA) Intelligence predicts that by year-end 2025, there can be from 1.9 to 2.8 billion eSIM smartphone connections globally. In a podcast, Counterpoint Technology Market Research even claims there can be over six billion eSIM devices shipped by 2025.
Read on to find out how telcos, MNOs and MVNOs capitalise on their markets’ continuously rising adoption of eSIM technologies.
1. Drive sales of eSIM subscriptions or upgrades to expensive plans
Through eSIM, operators can create flexible subscription plans that encourage subscribers to add multiple devices to a single plan. eSIM makes it easier for subscriber profiles to be available and extendable to more than one device.
Thus, a subscriber can readily download his subscription plan details to all his eSIM-capable devices. These can include his tablet, laptop, smartwatch, and other wearables. All of his smart devices can utilise his subscription plan allowances and credits without limitations and without having to first link to his smartphone; they will have a direct link to the operator.
Nor will his associated devices require a physical SIM card containing his subscriber profile and plan information. This is what makes eSIM so convenient for subscribers who want their subscription plan to cover multiple devices.
This ability to expand their plan coverage to easily and readily include as many devices as possible can induce subscribers to shift to an operator that offers eSIM mobile plans. Therefore, having eSIM-deployable subscription plans can help grow an operator’s market share.
The eSIM can also help operators earn more from every subscription.
Existing subscribers would need a bigger data allocation to adequately cover the data needs of all their devices. Consequently, operators can create single-user, multiple-device subscription plans with bigger data allocations among other features (say, a wider network coverage). Naturally, such plans will have a higher price point than single-user, single-device plans.
Operators can also reinvent their group and family subscription plans. Traditionally, a subscriber has to apply for and procure a physical SIM card for every person he’s including in his family or group plan.
With eSIM, operators can make procuring a group or family subscription plan easier for subscribers. Plan application and activation can all be done online, and subscribers can include anyone in their family plan simply by downloading it to every plan member’s eSIM-capable device.
Operators can keep their group and family subscription plans flexible, allowing subscribers to add as many members to their plan as they want. Naturally, more plan members means greater data, airtime and SMS allocation requirements — thus, greater revenues per subscription.
2. Save on distribution and production costs
Operators no longer need physical SIM cards with eSIM. They can provide their subscribers with their subscription details quickly and securely over the air. This translates to significant SIM card production, warehousing, monitoring, and distribution cost savings.
This also means more efficient operations. A new subscriber doesn’t even have to be physically present at an operator’s store to obtain a subscription plan. One can apply and pay for his subscription online, then be remotely provisioned with his subscription profile. This will reduce the need for brick-and-mortar SIM card storage and retail facilities.
3. Improve customer experience
With improved efficiency comes a better customer experience. With a successful eSIM implementation, someone should be able to apply for a subscription plan and activate the same within minutes. This translates to a great customer experience.
In 2016, Forrester analysed the revenue of five pairs of companies. Each pair consisted of a company with a high CX score and a company with a comparably low CX score; both companies in the pair belonged to the same industry.
The results were conclusive. Across all five pairs of companies, the high-CX-score companies significantly outperformed their low-CX-score counterparts in revenue growth from 2010 to 2015. In other words, high-CX companies made more than low-CX companies.
Therefore, eSIM can increase revenues not only directly through increased subscriptions and plan upgrades. It can also do this indirectly by positively impacting customer experience, which can, in turn, drive revenue growth. If operators can improve their customer experience with eSIM implementation, they can benefit from CX-driven revenue growth.
4. Realise more revenues from short-term users
Operators can use eSIM to increase revenues from transient users. For example, they can create pay-as-you-go plans specifically tailored to in-country visitors.
With eSIM, travelers can readily obtain pay-as-you-go mobile network plans. They can conveniently sign up for a plan online and get their eSIM provisioned over the air. If the plan doesn’t suit them, they can upgrade it easily or even shift to another operator altogether.
Yes, in-country visitors could already obtain pay-as-you-go services from local operators even before the advent of eSIM. However, the traditional physical SIM card system is not as convenient as its corresponding eSIM implementation.
The ability to seamlessly shift from one plan to another and to change networks, if necessary, can only mean higher utilisation rates and, thus, increased revenues for operators.
5. Provide more digital services
With widespread consumer adoption of eSIM, operators have the opportunity to activate more revenue streams by offering more digital services. Operators are no longer limited to providing call minutes, SMS capabilities and data connectivity.
The eSIM chip on eSIM-enabled devices can store multiple profiles. Therefore, even active subscribers of competing operators can be persuaded to sign up for another operator’s services. While it’s true that only one profile can be active at one time, switching profiles can be as easy as tapping on the profile one wishes to use.
Therefore, the eSIM lets operators offer digital services like mobile payments, digital identities and access authorisation, among other potential applications. With eSIM, they can also even provide highly convenient internet of things or IoT and tracking services to enterprises.
It’s time to shift to eSIM
The embedded SIM or eSIM revolution is an opportunity for mobile network operators and mobile virtual network operators. They can leverage it to create unique subscription plans, offer more services, streamline operations and, in the process, activate new revenue streams and realise operational cost savings.
AUTHOR BIO
Emily Roberts is a Business Development Executive at Workz, a top Dubai-based provider of secure connected solutions for consumer, M2M and IoT devices. Workz is one of the global leaders in mobile IoT, one of only five providers in the world to be certified by the GSMA to manage the complete eSIM lifecycle, and the world’s largest manufacturer of telecom (SIM and prepaid) cards.