How the eSIM Shifted the OEM Power Balance 

Every year, every industry ventures further into digitization - usually in pursuit of greater efficiency. Sometimes this happens in a single surge which can shift the structure of the entire marketplace. 

Just such a surge happened with the introduction of the eSIM to the mobile market, which changed the relationships and responsibilities of the entire connected device value-chain. 

The eSIM impact  

The 'e' stands for embedded, as the eSIM is a permanent part of the device's own hardware. This frees up space and delivers a better customer experience with more robust environmental protection.  

No manufacturer would expect their customers to stick with the same carrier for as long as they had that device. Leaving aside potential breaches of competition and market regulations, what happens when the customer travels to a region their carrier doesn't service? What if the carrier fails or merges?  

Thus, the fundamental power of the eSIM is in remote SIM provisioning. This is the ability to update the SIM 'over the air' and store one or more operator profiles. This agility and adaptability was the true disruptive power of eSIM tech. 

It meant that a profile could be installed during manufacturing for some use cases, installed automatically on first boot of a device for others, or installed by the user when they took the device out of the box. What's more, a new profile could be installed at any time, such as when the customer went on holiday and landed in another country. 

The rise of OEM 

As the eSIM became available on mainstream products such as iPad and Apple Watch, it quickly caused a shift in the roles of OEMs, chip manufacturers and MNOs in relation to the consumer. 

The ability for customers to easily switch between operators without having to change the SIM had a significant impact on the longevity of customer-operator relationships. 

Initially limited to the prepaid and SIM-only segments of the market, there followed an increase in other retailers (or device vendors) offering financing deals on handsets to spread the cost of the device, ultimately reducing demand for locked SIMs and post-paid deals with operators. Some OEMs were more ready than others to fill this void in consumer interaction and leveraged it to build brands that are today's market leaders. 

A new connectivity landscape 

The eSIM and remote provisioning have established themselves as the predominant market differentiators, already too important for the M2M market to ignore. Smart OEMs are now in an unprecedented and enviable position that if used wisely this tech will lead to great gains.  

Find out more about how 1GLOBAL is building a better future with embedded SIM, here.