What Is eSIM & How Does It Work?


What if you didn’t have to pay extortionate data roaming charges when you traveled? Or to carry your large iPhone while jogging and just brought a FitBit? Or even didn’t need to be near a phone to switch operators?

All of that – and much more – is possible with an eSIM solution.

What is an eSIM?

We’re used to SIM cards being little pieces of plastic we insert into our phones. SIM cards appeared in the GSM standard in 1991, replacing a user’s device login with a memory card. This allowed to switch between operators and retain a user’s mobile number when they changed devices.

Over the years, the SIM card became smaller and smaller, from a full-size SIM resembling a credit card to a mini-SIM, a micro-SIM, and eventually, a nano-SIM. However, these are starting to become too big for modern mobile devices. After all, in this day and age, smartphones aren’t the only ones that can serve as mobile devices. The makers of IoT devices, tablets, smartwatches, fitness trackers, and the likes would have a hard time fitting even a nano-SIM into them. This is where eSIM comes in.

Embedded SIM prototype with adapter board from 2013, as used in machine-to-machine (M2M) applications on a business card for scale.

Contrary to an understandable misconception, “eSIM” doesn’t mean “an electronic SIM-card.” The “e” stands for “embedded” and is not that hard to grasp once you’re clear with the meaning. The chip is embedded into a device directly. This is not a new technology, but with the new iPhone featuring the eSIM and with Ericsson recently launching an eSIM solution, it’s shaping to be quite a trend for the new decade.

How does eSIM work?

According to the GSMA, eSIM allows remote SIM provisioning on any mobile device. Switching between different carriers on the same device while traveling without having to replace a physical SIM card is only one example. Not only can it help you save money on data charges, but it would also reduce the time and risks associated with choosing a new vendor that you don’t know much about while retaining your number. The likelihood of you losing your eSIM (you’d have to lose your device to do that!) is hopefully also unlikely.

Some operators have better connections in certain areas than others. Changing operators, even when you’re at home, is something you should be able to do if you wanted to. This is particularly relevant for emergencies or urgent situations. An eSIM would allow you to change between operators whenever you wanted to for the best quality connection. This also applies to using Wi-Fi hotspots, which travelers often do to avoid paying data roaming charges abroad. Such hotspots are often not secure and, unless you’re using a VPN, you could become a victim of a hack. An eSIM can reduce this risk and help you save money too. In addition to smartphones, it also allows you to connect other devices to mobile networks. These could be laptops/PCs, wearables, and even pet service devices.

Ericsson Network Operations Control Room NOC Photo_crop
A busy Ericsson networks operations control room

Ericsson Consumer Lab reports that people are interested. Although the consumers are wary of the possible complexities in setting up an eSIM, they’re willing to invest in it. The “try and buy” option is particularly attractive to many consumers as well as carriers. Ericsson’s eSIM solution serves the onboarding of eSIM consumer devices while capitalizing on the findings and consumers’ apparent interest.

Secure automated provisioning of service

“If a service provider has both the secure entitlement server and eSIM manager from Ericsson, we can enable a 100 percent automated provisioning of eSIMs”, says Ericsson’s Head of Solution Area Communication Services Monica Zethzon. “This offers a highly efficient way to provide flexibility and good customer experience for the consumers.”

Also interesting: What Is NFV and How Does It Enable 5G?

On the B2B side, the eSIM gives many opportunities to mobile operators. McKinsey reports that given the popularity of IoT trend that’s only gaining momentum, the operators can open brand new markets for themselves by offering multiple devices under a single contract. Their logistic costs traditionally associated with regular SIM cards would also be reduced. And mobile device manufacturers wouldn’t sit on the sidelines of this innovation, either. Since an eSIM takes up way less space than a traditional SIM-card, they can “pack” smartphones with brand new cool features. There’s much room for collaboration between the operators and the manufacturers here. Same for sim card vendors, if they’re willing to invest in R&D.

What are the challenges?

A legislative challenge is not a small one. In some countries like Russia and China, eSIM technologies are contrary to legal requirements, such as a phone contract, including a sim card’s physical identifier, which eSIMs don’t have.

Another challenge is the loyalty challenge. The Ericsson report explains that the consumers are more likely to prioritize the quality of network connection rather than loyalty to an operator brand. Mobile operators would, therefore, have to work hard to keep up when eSIM becomes a widely available technology.

eSIM logo as defined by the GSMA

But there’s also the issue of them wanting to pursue it in the first place. If it’s that easy to lose a customer through a simple press of a button, how would the operators make money off data roaming? No network is foolproof, so this innovation could potentially lower the customers’ retention levels. So, the reluctance of some operators to embrace it would also be understandable.

It’s maybe the future but not far future

Although GSMA has issued the technical specification for eSIM, the standardization is still an ongoing process. And not a smooth one. Last year, the DoJ completed a two-year investigation into the handling of the standard. If the government of the birthplace of Silicon Valley has looked into the technology, there is a good chance that the law enforcement organs of less tech-friendly jurisdictions would scrutinize it even more. Unfortunately, tech often surpasses the law, and the law often struggles to catch up. So, I wouldn’t expect the standardization to be an uncontested process.

Despite these challenges, eSIM seems to be here to stay. Thanks to players like Ericsson, it’s now more consumer-oriented. We shall monitor the global implementation of this technology closely.

YouTube: The GSMA Embedded SIM Specification – Business Processes for Remote SIM Provisioning in M2M

Photo credits: The feature image has been done by Glen Anthony. The embedded SIM photo is owned by Paul Marshall. The eSIM logo is owned by the GSMA. The network operation control room photo is from the repository of Ericsson.
Sources: Ericsson NewsroomEricsson Consumer Lab ReportGSMAMcKinsey ReportEuropolChris Ziegler (The Verge) / IoTConf.ruMark Jansen (Digital Trends) / 1oT (IoTForAll) / Scott Bicheno (Telecoms.com)

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Kate Sukhanova
Kate Sukhanova
I’m a writer with a keen interest in digital technology and traveling. If I get to write about those two things at the same time, I’m the happiest person in the room. When I’m not scrolling through newsfeeds, traveling, or writing about it, I enjoy reading mystery novels, hanging out with my cat, and running my charity shop.
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