Is the world ready for eSIM?

by George Lovell | | 0 comments

All iPhone 14's sold in the US are eSIM only ("e" stands for embedded). In other words, they do not have a slot for a physical SIM card.

In our opinion, this was a big risk to take, with a small potential upside. At worst, it's disastrous for iPhone users and sales. At best, we'll all be using eSIMs a bit sooner than expected. Or maybe (probably) it just doesn't matter that much and no one really cares. 

We're going to explain why we think this was a miscalculation by Apple.

Let's first touch on the concept and history of eSIMs.

Dual SIM mobile phones are nothing new. We've had them in some form since 2000. Everything from basic Nokias, to top-end Android smartphones have been available in Single SIM or Dual SIM versions. Apple have only released dual SIM iPhone's in China; never in Europe or the US.

By contrast, eSIM technology is quite young. Released in 2018, the iPhone XS, XS Max and XR were the first Apple phones to support a digital SIM, which could be used in addition to a physical SIM. The Google Pixel 2 - released in 2017 - was the first smartphone with embedded SIM technology.

In eSIM devices, a small chip inside the phone controls the cellular function entirely. The information on an eSIM is rewritable, which means that the user can still change their number, network provider or data plan.

In the digital age, it begs the question - why have a physical SIM card at all? Digital products are more flexible, convenient, reliable and efficient than physical products in most cases. No SIM slot means more space inside the phone for a bigger battery or other components. It's also better for water resistance. Your Apple Watch uses e-SIM only, why not your iPhone?

Our current cellular systems and infrastructure are designed to work with physical SIM card technology. These systems are complex and universal, so they take a long time to update, especially in this case - it's a lot of work, there's no huge financial incentive, and the current system works just fine.

Many people in the UK and the US, have been vocal on their difficulties with activating an eSIM, describing it as a slow, clunky, and frustrating experience. This would suggest that the technology is inadequate, or that the carriers haven't yet figured out how to deliver it to the consumer.

Most of our UK networks support eSIM technology, but most networks in developing countries such as India don't. China do not allow eSIM (shock), because it cannot be tracked and monitored. Phones are sold globally, and need to be compatible with as many networks as possible.

We must also consider the implications for the network providers themselves (EE, O2, Vodafone etc.). They can maintain a much closer bond with their customers, who rely on their physical products to make their devices work. They may be reluctant to relinquish some of this control, but this is just our speculation.

Physical SIM cards are actually a very secure way for the user to authenticate with the network - perhaps more so than digital SIMs, because they cannot be cloned, stolen or hacked. Note: we do not have sufficient knowledge to assert which of these technologies is more secure overall.

A major issue arises for people that travel, especially those that frequently travel to different countries for work. Millions of people rely on being able to switch to a Spanish, Canadian, Japanese or Egyptian SIM card at the airport. Most countries don't have the technological infrastructure to support eSIM, or are restricted by government regulation. Developing countries in particular do not have eSIM compatibility as a top priority. Do Apple not see this as a problem?

We know better than anyone how much people rely on their phones for just about everything. When our customers drop their phone in for essential repairs, they can simply swap their SIM card into a spare phone - no need to have Apple and/or your network provider get involved.

But is it that important to have a mobile number whilst your phone is in for repair? YES! So many of our critical accounts rely on two-factor authentication, meaning we cannot login to our email, travel, banking, payment, or health apps without receiving a code via SMS. Imagine if your phone is liquid damaged beyond repair... Nightmare!

Lastly, an eSIM-only iPhone locks users into the Apple ecosystem. A lot of heavy tech users and enthusiasts use or switch between an iPhone and an Android phone. This will be a lot harder to do with eSIM. 

These points should explain why we haven't yet transitioned to eSIMs exclusively.

Now, let's make an argument for moving to eSIM in 2022.

No one company change the status quo by itself. Henning Schulzrinne, a professor of computer science, said that SIM cards are "a good example of an interdependent system that makes it difficult for anybody to change until everybody changes."

What if no company ever made the leap? Would we just be stuck with physical SIMs forever? Perhaps it's a case of move fast; fix as we go. Humans, free markets and technology are incredibly adaptive. The world isn't ready for electric self-driving cars, but thank God companies like Tesla are trying, right? eSIMs aren't going to save the planet, but the concept still applies.

The US tends to be the frontrunner in, and testing grounds for, technological innovation, i.e. they get everything first - so it makes sense that the US mobile market makes the transition to eSIM first. You have to expect that the rest of the world will follow.

eSIM is the future. It has the potential to replace our existing mobile system with something better. Transitioning from a well established, universally adopted system is hard - harder than starting something new from scratch. Sometimes, it takes a bold move from one company to change the status quo. Perhaps Apple think that the rest of the world can and should adopt eSIM now. When the worlds largest company pulls the trigger, it creates massive incentive - perhaps even a necessity - for everyone else to jump on board. If this is the case, then we might just get the improved product sooner than we would have otherwise, at the cost of a little bit of friction in the short-run.

As we have seen time and time again, Apple have disproportionate power to guide the market in whichever direction they please. Other manufacturers will soon follow suit, as they did with the removal of the headphone jack. The perpetual cycle of copying each others concepts until their products become homogenous continues.

Anything that makes a product less versatile by taking control away from the user without a solid rationale is difficult to justify.

However you spin it, removing a feature and calling it "innovation" is a bit of a joke.

What will they remove next? Our money is on the charging port - before wireless charging is actually good. If eSIM has ruffled some feathers, a port-less phone will kill the whole flock.

In time, networks will adapt, the technological infrastructure will catch up, and we will manage our SIM plans through an app. Buying, activating and fiddling around with plastic SIM cards in fragile little trays will be a thing of the past that the children of today will never understand - just like they will never understand buying a newspaper.

It will be interesting to see if next years European/UK spec iPhone is eSIM only. Either way, we expect that everyone in Europe will be using eSIM within the next 5 years. As for developing countries, we've no idea. It's anyone's guess. 

Thanks for reading!

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