PARTNER FEATURE: eSIM technology came into its own during 2020, with Apple, Google, Huawei, Motorola and Samsung all launching 5G phones with eSIM capability. Overall, the number of eSIM devices commercially available for purchase reached 110 models at the end of 2020, according to GSMA Intelligence.
[1]Mobile network operators are still learning about eSIM and digital identities. Some wonder if eSIM will make it easier for customers to churn, but actually the opposite may be true, according to Matthew Cole, CEO of secure enterprise transactions at Idemia (pictured, right).
“If mobile network operators are able to provide the superior experiences that their customers expect, they are likely not only to gain and retain more customers but also to activate more connected devices,” Cole explained. “Today’s consumers expect an out-of-the-box experience when acquiring a new connected smartphone, smartwatch or tablet. eSIM enables consumers to subscribe to telecom plans anytime and anywhere,” he said. “Using methods such as QR codes, MNOs can meet their subscribers while in-air, on the ground, or even underground on public transportation. Subscribers need just to scan the code with their devices and follow a few simple steps to activate a plan and start benefitting from services”.
New revenue streams
Cole said eSIM technology also gives operators a way to “create new business models and services, and to generate new revenue streams by upselling and cross-selling different plans to the consumer”. This will be driven by the convenience of the user journey enabled by digital identity proofing and remote eSIM activation. The combination will allow consumers to easily activate new devices or subscribe to a connectivity offer while travelling, for example.
“Using a smartphone, the user can scan an ID document and then use their camera to take a selfie. The image of the document is verified for authenticity, and the selfie is compared against the photo on the ID card, or even against a trusted national database, depending on local regulations,” Cole explained. “Using these digital identity solutions, MNOs can create fully digital onboarding journeys that enable them to verify and register their subscribers’ identities, fulfilling know-your-customer and anti-money laundering regulations required by many countries, while reducing processing time and costs…By further leveraging these identity attributes, MNOs can also create new services that enable their subscribers to access finance, insurance, or media and thus diversify their offers and revenues in today’s competitive market”.
Such services could include single sign-on experiences for mobile customers looking to access relying party services.
Digital ID, eSIM and Security
eSIM and digital identity represent an opportunity for operators to ensure security as they monetise 5G through new services. Cole noted “5G by itself offers a number of new possibilities and use cases, including streaming, autonomous vehicles, as well as the ability to connect large numbers of devices in a small area”.
“As we continue to explore these new use cases, the challenges for mobile operators will be to ensure uncompromising security of their networks and their subscribers. This can be facilitated by identity-based technologies such as remote user ID verification and authentication during a digital customer onboarding process.”
Digital identity also helps operators secure the devices on their network. “Requiring customers to digitally verify their identity during the onboarding step is a simple way for mobile operators to prevent SIM swap fraud,” said Cole. “Once equipped with this data, a mobile operator can request customer authentication via a selfie check or document scan before validating any eSIM requests, such as activating a new service or modifying a user’s plan. Thanks to biometrics, these additional layers of security can be nearly seamless for mobile subscribers.”
eSIM also enhances IoT security, since SIM cards carrying sensitive information cannot be removed from the device, as the eUICC is soldered. “Cybersecurity is obviously a key element for sensitive IoT applications, especially those that could be fooled by dummy devices pretending to be sensors or meters,” said Cole. “Any disruption to the electricity, water or gas smart meters of a country can be a major cybersecurity threat. The eSIM can play a key role in providing connectivity security and flexibility of IoT device data, as well as securing the IoT applicative layer to protect the information sent to the cloud of the IoT service provider,” said Cole. “This is done thanks to IoT SAFE solutions, as recommended by the GSMA.”
IoT applications
IoT applications are expected to be one of the most significant ways in which network operators will monetise 5G. When these networks are combined with edge compute nodes, device data can be analysed near the point at which it’s generated and enterprises can take action in real time. Much of that connected equipment is expected to rely on eSIM connectivity.
“On a basic level, eSIM can help optimise roaming fees and quality of coverage for fleets in transit,” Cole said. “This helps ensure remote monitoring and quality of service. These capabilities can even play a role in more advanced use cases, such as management of the IoT connectivity of the entire logistics chain. Being able to switch from one connectivity provider to another via a central server gives companies the flexible, always-on connectivity, independent of the type of devices connected.”
Smartphones first
For MNOs, smartphones are likely to be the predominant eSIM-enabled devices for the foreseeable future. The GSMA forecasts 2.4 billion smartphone connections globally will use eSIM by the end of 2025, representing 33 per cent of total smartphone connections.
Already, eSIM service is commercially available for more than 2 billion mobile users, GSMA information showed. Operators which take advantage of eSIM and digital identity now will be ahead of the curve as their customers adopt and eventually demand the services eSIM enables.
However, with the development of 5G networks and other types of connected devices, for smart homes and cities, and even laptop PCs for remote working, we can expect all these devices will have a role to play in eSIM activation growth in the coming years on top of smartphones.
[1] https://www.mobileworldlive.com/wp-content/uploads/2021/08/Matt_Cole.jpg
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