Key Takeaways
- China’s three major telecom operators have received MIIT approval to launch eSIM mobile phone services nationwide.
- eSIM technology promises enhanced user experiences in both mobile phones and the Internet of Things (IoT), facilitating network switching and device miniaturization.
- The wider adoption of eSIM in mobile phones is expected to accelerate the growth of IoT eSIM applications, aiming for nearly 2.2 billion connections by 2030.
Commercial Launch of eSIM Technology in China
China Telecom, China Mobile, and China Unicom have officially launched eSIM mobile phone services after obtaining approval from the Ministry of Industry and Information Technology (MIIT). This marks a significant step toward the full-scale application of eSIM technology in the telecommunications sector, finally allowing mainstream mobile phone manufacturers to roll out supported models.
Although eSIM technology isn’t new, its integration into mobile devices has faced hurdles due to various interests. Beyond mobile phones, eSIM is rapidly gaining traction in the IoT sector, which has shown broader application across smart wearables, vehicles, and industrial settings. This shift suggests that user demand for IoT eSIM solutions is robust, and the integration of eSIM technology in mobile phones stands to enhance the entire eSIM ecosystem and foster IoT development.
eSIM has distinct advantages over traditional SIM cards, notably in space-saving—allowing the elimination of the SIM slot—and enhanced resilience in challenging environments. Additionally, eSIM significantly reduces logistics costs associated with physical SIMs, leading to a smoother network switching experience for users.
The transition appears to be particularly advantageous for IoT applications, where network identities are less critical. Unlike mobile phone numbers, which are heavily tied to personal identification, IoT device numbers serve primarily as identifiers for device management, making network switches less problematic.
Given the differing operational contexts, eSIM technology can thrive in IoT deployments where devices often face harsh conditions. As mobile communication networks become more established, IoT devices frequently operate in areas with weaker coverage, emphasizing the need for easier network configuration options.
Counterpoint data indicate that by the end of 2023, eSIM connections within IoT could reach 200 million, with projections suggesting 2.2 billion connections by 2030 at a 43% growth rate. The previous rollout of eSIM for IoT services has been more straightforward than that for mobile eSIMs, but awareness among mobile users remains relatively low. Surveys show that only a minority of consumers are familiar with eSIM technology.
The MIIT’s recent trials may increase awareness and acceptance of mobile phone eSIMs, which could in turn bolster the implementation and growth of IoT eSIM services. A comprehensive ecosystem has already emerged, with domestic companies developing eSIM chips, modules, and management platforms meeting international standards.
As policy awareness and technological advancements continue, eSIM adoption is expected to accelerate, benefiting from enhanced network technologies such as 5G. The introduction of the new eSIM IoT specification by GSMA should also alleviate adoption hurdles, offering a structured remote SIM configuration suited for limited-access IoT devices.
Overall, eSIM’s potential for both mobile and IoT devices is substantial, promising improved user experiences and operational efficiencies moving forward.
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