
Robin Duke-Woolley
Founder and CEO, Beecham Research Ltd
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In the age of the Internet of Things (IoT), original equipment manufacturers (OEMs) face a critical threat. Equipment and other products not connected to the internet can’t compete with connected products that can generate data for new services, be easily updated with new features or be remotely monitored for performance. The value of an unconnected product is the product itself, while a connected product can support services that increases its value over its life.
As a result, connected products have a significant competitive advantage in the market. To thrive in today’s digital economy, OEMs across all sectors, such as consumer, energy, healthcare, industrial, retail, security/public safety and transport, need to develop service strategies based on connecting their products to the internet.
One key technology that can help OEMs more easily integrate connectivity into their products is the embedded Universal Integrated Circuit Card (eUICC).
eUICC is a type of Subscriber Identity Module (SIM) card, used to connect products and other devices to cellular networks.
eUICCs SIMs are different than traditional SIM cards. Traditional SIM cards are owned by network operators and can only use this operator’s network. If the device’s owner want to use a different network, they have to take out their SIM card and put in a different operator’s SIM card.
Unlike traditional SIM cards, eUICC SIMs can be owned by the user of a device and assigned to different network operators remotely. This enables the owner of a device to switch operators without replacing the device’s SIM card with one from the new operator.
eUICCs, in conjunction with device-to-cloud embedded SIM (eSIM) solutions that allow owners of devices to remotely manage eUICC network connectivity, make it easier for OEMs to design IoT connectivity into products, while also enhancing the value of this connectivity over the life of the products.
eSIMs are SIM cards that are embedded in an device during the device’s manufacturing process. Since they are embedded into the device and can’t be removed or replaced with another SIM card, eSIMs cards often use eUICCs or technologies that allow them to be assigned to other operators’ networks. eSIMs also improve device security, since they can be more easily concealed and are difficult to remove, helping prevent SIM tampering or theft.
eSIMs are generally integrated into devices as part of a larger eSIM solution that allows the device owner to assign the eSIM to other networks. Many eSIM solutions also include other features, including management platforms that allow device owners to monitor service quality, or connectivity services that allow a device to dynamically connect to another network if the signal for their current network is not available or weak.
As my firm details in its recent report, Business-Critical IoT Connectivity Solutions: Key Management Challenges, these and other eSIM capabilities are leading OEMs and other companies to increasingly use eSIMs instead of traditional SIMs in their devices and other products. For example, in a survey my firm conducted for this report, 78% of the IoT users and product manufacturers surveyed said they were either using eSIMs, or expected to use eSIMs in the future.
As mentioned above, an eUICC is not the same thing as an eSIM. An eUICC is simply a SIM card that is capable of being remotely provisioned and comes in a variety of form factors. An eSIM is a SIM that has been embedded in a device, and is sold as part of a larger eSIM solution that also includes the software and subscription management system needed to remotely provision the eSIM and manage its connectivity over time. Such eSIM solutions have been commercially available for a few years, but rather than use eUICC technologies, they have mostly been expensive, proprietary solutions. However, the eUICC standard is not proprietary. In addition, the GSMA (GSM Association), which represents the majority of mobile operators worldwide, is busy developing an eSIM specification for remote SIM provisioning that would accelerate the adoption of eUICCs.
With eUICCs, OEMs integrating IoT applications into their products can insert an eUICC eSIM card into a circuit board during the manufacturing process as if it were any other component. This eUICC eSIM solution can then be used to provision the eSIM with an appropriate network operator profile at the most convenient time and place in the product’s supply chain.
This means OEMs can order just one SIM SKU, streamlining production processes. A single SIM SKU also reduces costs by eliminating the time, cost and complexity associated with pre-ordering different SIM cards with different network operator profiles depending on where the devices may be shipped. It also changes the ownership of the SIM. Traditional SIM cards have been the property of an individual network operator, which supplies them to a manufacturer. With eUICC eSIMs, OEMs or service providers own the SIM card and can decide – and eventually change – which network operator is most appropriate for their product’s IoT application.
To date, Sierra Wireless has identified three main use cases for eUICCs:
Apart from the auto sector, Beecham Research has identified over 100 application groups where eUICCs can drive significant IoT market growth over the next five years. This growth will also be supported by the introduction of Low-Power Wide-Area (LPWA) cellular technologies, such as LTE-M and NB-IoT, which are very low cost and intended for deployment in very large numbers.
In the future, it is increasingly likely that hardware-based eUICCs will evolve into Soft SIMs, a collection of software applications and data that perform the functionality of a SIM card but do not reside in any kind of secured data storage card hardware. Instead, they would be stored in the memory and processor of the communications device itself, such as a cellular module. The exact direction of further development and growth of the eUICC market will depend on the acceptance by mobile operators that this is the right approach to cellular use in the IoT market.
For a more in-depth discussion of eUICC, read the white paper, eUICC: Accelerating the IoT Opportunity for OEMs. And Start with Sierra to learn more about how Sierra Wireless’ comprehensive device-to-cloud platform for building, deploying and managing IoT applications, including hardware, software and services, empowers OEMs to build IoT applications that transform their businesses in ways that enable them to thrive in the connected economy.
This article has been updated and was first published on the 15th of November, 2018.
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