The End of the Road for SIM Cards
August 17, 2015
The Subscriber Identity Module ("SIM") card is over 25 years old but has seen little innovation in that time. We have gone from the standard SIMs in 1991 that were credit card sized to nano-SIMs in your iPhone 6 but other than size, we have seen minimal innovation in security or options. Fast forward to today, and Apple and Samsung intend to change the way the consumer will be able to access cell networks. Likely by 2016, with the launch of the iPhone 7 or Samsung Galaxy S7, the SIM card will be embedded into the circuitry, the birth of the Embedded-SIM ("e-SIM").
As a consumer, the freedom to access different networks will never be easier. As an international traveler, the roaming rates by the Big 3 Canadian carriers are very steep compared to alternatives in the countries I visit. I have invested in unlocking my phone, a $50 one-time charge through most carriers, and buying a SIM card through iRoam. This offers me the ability to roam on a local carrier's network through the roaming agreements iRoam already negotiated. This is a great cost savings and convenient but can sometimes come with some connectivity hurdles.
Imagine that before you leave for your next visit to Europe, you purchase a prepaid plan directly from Vodaphone for a week. The e-SIM will enable you to do that directly with the foreign carrier, saving the use of carrying an extra physical SIM and they provide a better roaming rate than your Big 3 carrier. Also, if one carrier you originally used doesn't have the best coverage in the country you are visiting, just purchase another prepaid plan from another carrier with better connectivity, ultimate flexibility. Such a simple tool but with such a powerful proposal! This could also motivate the local Canadian carriers to offer more incentive laden prepaid offerings in the local market for local and international travellers.
Taking this technology to the next level is the hot button topic of the Internet-of-Things, a world where more electronics will be connected over the Internet. The ability to have e-SIMs in TVs, fridges, microwaves, cars, buses and trains will remove the need to have a physical SIM card inserted, which provides an entirely new user experience. The "smart" home will now be able to connect to one central network and offer another dimension of access. Now your fridge can tell you over an app that the compressor is overheating, or turn your lights off while you are sitting at the office. Telecom and major electronics manufacturers will be rushing to provide this next wave in users' hands in the next 12â??24 months.
For today, I'll keep my travel SIM and paper clip to change the SIM card close, but those days are fast ending and I look forward to starting my oven to cook dinner while sitting in traffic on my way home.
Inder Saini, CPA, CA, is Chief Financial Officer of Telehop Inc.