The Telecoms Industry's Netflix Moment: Why Connectivity Is Going Digital

In April 2018, music streaming officially overtook physical media as the music industry’s largest source of revenue – marking the end of a trend that had been apparent since the CD sales first started to dwindle in 2007-8.

The current streaming industry has no shortage of criticism, from paltry artist payments to dubious investments, “playola” recommendations, and the unchecked influx of AI-generated artists. For now, however, convenience still beats quality: Spotify subscriber numbers reached new heights last quarter, ending 2025 with 750 million active users. The average listening experience and discovery of today is unrecognizable from the early 2000s, when CDs accounted for 95.5% of all recorded music sales.

A similar pattern can be seen in the decline of DVDs. Every year since Netflix launched its streaming service in 2007, DVD sales have fallen by $1 billion. Film and TV streaming, meanwhile, is set to exceed $100 billion this year – or five times more than DVDs did at their peak. In 2023, Netflix quietly ended its mail-order service.

Now, the telecommunications industry is experiencing its own "Netflix moment” as eSIMs supplant physical SIMs. By 2030, Counterpoint Research estimates that software-based SIMs will account for 70% of all smartphone connections.

Like CDs or DVDs before them, the decline of physical SIMs is a story of consumer choice. In an era of eroding digital platform quality and "enshittification", eSIM technology is a rare innovation — a digital alternative to a physical product that improves on its predecessor in nearly every aspect. While vinyl records and Blu-ray discs maintain a dedicated fanbase, it’s hard to imagine SIM cards engendering the same nostalgia. In just over a decade, eSIMs have transitioned from a niche industrial tool to the world's most popular SIM format.

eSIMs and consumer RSP

It’s tempting to think of this as a universal process, where tactile products are inevitably replaced by digital ones in the name of progress. The reality is more complicated. Hardware innovation remains a key component of the mobile industry: cellular smartwatch sales are increasing year-on-year, while Samsung is set to release the third generation of its innovative folding phone this year.

In fact, much of the reason for the manufacturer-driven push towards eSIM-enabled smartphones is because of hardware demands: removing a bulky SIM card tray frees up space for larger cameras, longer-life batteries, or, in the case of the new iPhone Air, a wafer-thin body.

Meaningful software innovations like eSIM that resonate with the public are now seeing worldwide adoption. A shift of this scale is made possible by remote SIM provisioning, or RSP.

Like many consumer telco products, eSIMs were initially envisioned for commercial use, connecting wireless devices in the Internet of Things (IoT) industry. It took five years for them to enter the personal mobile market (debuting inside the cellular Apple Watch Series 3), and a further year for the first eSIM-enabled smartphone to appear. While the IoT industry is still a major target for eSIMs, the technology is now integral to the consumer mobile market.

Consumer Remote SIM Provisioning (RSP) creates, stores, and securely delivers digital SIM profiles to devices over the air. Today, RSP is a major component of B2B and B2B2C telecoms strategies, adopted by everyone from traditional mobile operators to business travelers, digital banks, airlines, and booking platforms.

Older readers may be familiar with the nerve-wracking process of hearing a single on the radio before taking a leap of faith and buying the full album on CD (or vinyl, or cassette). Sometimes this could result in a lifelong favourite record. Other times, it would lead to 1-2 increasingly disappointed listens and a lifetime collecting dust.

• Music streaming has upended this entire process, providing constant access to every recorded note in musical history for less than the cost of one album per month (for now). Telco is now entering the same phase: connectivity can be delivered instantly, anywhere.

• Like a streaming service, eSIMs and consumer RSP allow customers to decide where and when they want mobile access, downloading it in seconds rather than waiting for delivery, visiting a store, or dealing with long-term contracts.

Physical SIM plans from traditional operators would often lock customers into long-term contracts, bound by the physical capability of their phone to only recognize certain operators’ SIM cards.

With eSIM, however, users are free to store multiple SIM profiles on their device and switch between them in seconds, for example, when traveling abroad or changing between work and personal numbers. Their digital nature also means eSIM profiles can be instantly “pushed” to a user anywhere in the world. Just as streaming removed physical constraints from film, TV, and music, RSP and eSIMs have turned connectivity into a fully digital medium.

Is digitization always beneficial?

In many industries, digitization is employed as a cost-saver first, and user benefit second (if at all). The ongoing transition of car interiors from an isolated array of knobs and dials to internet-connected LCD interfaces, replete with proprietary software, is a typical case of a profit-led transition. While a sleek, tablet-based interface may look modern and reduce manufacturing costs, they also allow firms to introduce new revenue streams and implement paid software updates.

In an environment where many digital platforms are perceived to be declining in quality, eSIMs are a welcome addition that improves user experience, convenience, and cost efficiency.

What eSIMs unlock for mobile operators

The initial drivers of consumer eSIM usage were not mobile operators: the greatest pressure came from hardware device manufacturers looking to purge unnecessary components from their devices’ interiors and integrate SIM connectivity within the device’s OS. Traditional carriers were initially wary of eSIM, fearing the network switching capability would reduce customer loyalty and threaten their fundamental business model of long-term customer relationships and rolling contracts.

As public awareness of eSIM grows, driven in no small part by this manufacturer and OS developer push, operators are exploring the potential they offer, viewing eSIM as an opportunity rather than a threat.

Consumer demand aside, the new format provides several benefits for mobile carriers:

1. Logistics: With an eSIM-only service, SIM card logistics can eventually be entirely removed from the mobile supply chain and relegated to niche commercial applications and specific devices in the Internet of Things (IoT) industry. The manufacturing, packaging, and transport costs and environmental impact of SIM cards can be entirely avoided by switching to eSIM.

2. Customer satisfaction: Contrary to initial mobile industry fears during the early days of eSIM, software-based SIM services can strengthen relationships between the mobile operator and the customer. Users no longer need to visit a store or wait for a SIM card to be delivered: operators can instantly connect new customers via RSP, wherever they are in the world. The same process allows carriers to manage customer SIM profiles and deploy software updates remotely.

3. Additional revenue streams: Operators can bundle in additional digital services within their eSIM packages, from streaming subscriptions to online shopping. Travel eSIMs are a popular add-on to existing mobile plans that can be instantly distributed to customers and provide a revenue boost.

4. Insights and analysis: eSIMs offer real-time customer insights into data usage and mobile device habits. An RSP partner like 1GLOBAL collates these insights in a single management platform, allowing operators unprecedented levels of analysis. The same platform provides simple, in-depth management of user SIM profiles.

Will eSIMs deliver streaming-level success?

Instant global distribution

As we’ve previously explored, eSIMs have shifted the power dynamic away from carriers and towards device and OS system operators.

Capitalizing on this ongoing shift required operators to adopt seamless consumer RSP solutions that can match customer expectations and differentiate themselves in a crowded market.

By building an RSP infrastructure that delivers instant SIM distribution and in-depth customer insights, mobile operators can continue to stand out in the eSIM era. Developments like Zero-touch deployment remove the risks of human interference from the distribution process, ensuring the safest possible SIM supply chain.

Multi-device ownership

The first eSIM consumer device was the Apple Watch Series 3, released in 2017. The reduced footprint of an eSIM makes it a natural fit for smaller devices, wearables, tablets, and other non-smartphone cellular devices. In a recent state-of-the-market overview, GSMA Intelligence highlighted how this model of multi-device ownership is becoming normalized. From wearables to connected cards, it's increasingly common to own several cellular devices. For operators, consumer RSP, backed by security innovations such as 1GLOBAL’s entitlement server, can help them implement this model and provide a unified, easy-to-use connectivity service for each device.

The new format provides opportunities to strengthen relationships, roll out new revenue streams, and instantly respond to customer preferences – when built on a secure, fast, and scalable consumer RSP strategy.

1GLOBAL RSP

RSP is part of a wider digital customer approach to connectivity: users expect seamless digital experiences when they pick up a phone – including connectivity itself. A typical customer can expect to download a mobile plan, instantly pay for it via biometric-approval, and start using it without leaving the app.

This movement is exemplified by the bundle economy, where mobile operators incorporate streaming and other digital services into their own platforms, creating a one-stop shop for online subscriptions. Zero-touch distribution allows operators to remotely “push” a profile to a user, without any manual input. The frictionless process has opened the door to faster, more secure SIM provisioning (through multiple authentication processes, the exact right SIM profile is transferred to exactly the right device, with no chance of human error or input at either end).

Global eSIM usage is projected to experience surging adoption, coinciding with ongoing worldwide access to cellular devices. By 2030, 42% of all mobile device connections are expected to occur via eSIM. This is the inflection point – the telecoms equivalent of the CD downfall. Operators who embrace this change are set to benefit.

Doing so requires a partner with global capabilities and state-of-the-art RSP security. 1GLOBAL RSP services are trusted by over 50 mobile carriers worldwide, and reach 450+ million users. Contact us today to learn more about how 1GLOBAL is preparing consumer mobile brands for the future of connectivity.