What is an eSIM and how is it changing industries?

A look at how eSIMs work, and how they’re impacting businesses and transforming industries.
Kelli Harris
October 27, 2021
illustration of an eSIM

The SIM card has been around since the early 1990s. It is a small, removable piece of silicon and copper encased in plastic. Each manufactured SIM has a globally unique serial number called an ICCID (Integrated Circuit Card ID), along with an IMSI and IMEI, to identify it on the network. There are pads to interface to a modem or a processor, allowing the device to authenticate on a network as unique. If that unique SIM device has a plan with a carrier, the data from the modem or processor is allowed to pass through the network to some endpoint — either a server or telephony system.

Right, so what is an eSIM?

The eSIM (embedded SIM) is a small chip soldered directly to a board inside a device.

The “e” in eSIM does not refer to “electronic” as is so often the case (for example, eMachines, eCommerce, and e-mail). Instead, it refers to “embedded” — a SIM that is directly attached to a board and is not removable. The official name for this form factor is MFF2.

The MFF2 operates in the same way as a regular SIM card. Unique identifiers like the ICCID identify your device as it communicates with nearby cellular towers. The obvious difference is that there is no way to remove the eSIM without desoldering it from the board.

While “an embedded SIM” is still technically the definition of an eSIM, it’s gotten more complicated since the eUICC appeared on the IoT landscape. The eUICC is an embedded universal circuit card — the software that allows network operators to send out SIM profiles to their devices remotely. Today, rather than saying “eUICC-capable SIM,” most people simply say “eSIM.”

Ultimately, the eSIM is the hardware component, and the eUICC is the software component or operating system that allows for over the air (OTA) profile updates.

Recommended reading: 5 Benefits of Building With eUICC

What are the differences between standard SIMs and eSIMs?

To understand the differences between standard SIMs and eSIMs, let’s take a closer look at how each one works.

How do SIM cards work?

If you have an IoT device with a slot for a traditional SIM, here’s how you would connect:

  1. Choose a provider and a data plan.
  2. The provider or carrier sends you a SIM card to your device’s specifications — one that has data stored on it that’s unique to your chosen network and line of service.
  3. Insert the SIM card into your device.
  4. The device uses the SIM as an identifier as it connects to the network carrier.

If you want to switch to a different provider or line of service, you’ll need to remove the SIM card and repeat the same process with the new provider.

How do eSIMs work?

Choosing an eSIM for your IoT device requires some planning and decision making ahead of time. Because the eSIM is soldered into each device, it needs to be part of the original design. This process requires coordination of your supply chain to make sure you have the needed eSIMs during the manufacturing stage. Once your devices are assembled with eUICC-enabled eSIMs on board, you’ll go through a standard process to connect them to the network:

  1. Use a built-in bootstrap profile to establish an initial network connection.
  2. Download a profile (or multiple profiles) through an over-the-air (OTA) provisioning process.
  3. Once the SIM profile is downloaded and installed, the network recognizes it, and the device uses it just as it would a physical SIM.

Recommended reading: How Multi-IMSI and Cellular IoT Work Together

Benefits of using eSIMs

While it takes more advanced planning to incorporate an eSIM in your IoT device, the technology offers several key benefits for businesses. Let’s take a look.

Pros of eSIMs

  • Simplify global manufacturing
    Choosing eUICC-enabled eSIMs can simplify your manufacturing process. The embedded form factor allows for versatility in size and assembly — you don’t need to have a person inserting SIM cards during manufacturing, and your device can be more compact and well sealed. Also, since you can send out the needed SIM profile to the devices after they’re deployed, your global supply chain can flow without interruption, creating a single, global product that can be deployed just as easily in Bangalore as it can in Baltimore.
  • Avoid expensive recalls
    With traditional SIM cards, if you need to switch carriers, you need to switch cards. That means locating every device, removing the cards, and replacing them with the new SIMs — all potentially expensive undertakings. With the eSIM, if you need to change providers, all you have to do is push out the new SIM profiles via RSP. No need to recall devices from the field, and your technology is future-proofed against any unforeseen changes in network needs.
  • Get flexible coverage
    Limiting your devices to a single provider’s network might work in urban areas, but what if your IoT device is deployed in a suburban or rural environment? It might pick up a stronger signal from one carrier and a weak signal — or no signal — from others. When your devices have a single home network relationship, you’re going to uncover many edge cases where that one network is not enough to provide the coverage you need. Using the eSIM helps you avoid that frustration because you can choose the device’s network after it’s deployed—and change it out in the future if it ends up in a different part of the world.

Recommended reading: How to Get Started With eUICC for Your Deployment

Cons of eSIMs

  • Less simplicity
    In many cases, eSIMs provide more simplicity for handling connectivity on your devices — but sometimes it’s simpler to keep the traditional physical SIM setup in place. For example, if the devices will be easily accessible to humans and you expect to change carriers or service types often, it might make better sense to choose traditional SIMs.
  • Limited network coverage and support
    While eSIM technology is growing rapidly around the world, service is still somewhat limited. If your business deploys devices globally, you’ll want to make sure eSIM service and OTA provisioning are supported by local networks in each area.
  • Permanent traceability
    With eSIM, you can’t simply remove the SIM from a device — which means there’s always a way for you (or a bad actor) to track that device’s physical location. It cannot fully disconnect from the network unless it’s completely dismantled, making it a possible security risk in some use cases.

How can eSIM and eUICC impact my business?

The eSIM represents a big step forward for SIM technology, and it’s set to impact IoT device deployments in major ways. While traditional SIMs still work best in some situations, the eSIM has a lot to offer companies in many industries and verticals. Here are a few examples:

  • Healthcare devices
    Wearable health monitors often need to endure harsh conditions such as moisture, temperature fluctuations, and vibration. Choosing eSIMs rather than traditional removable SIM cards allows manufacturers to seal the devices, allowing for better durability.
  • Connected vehicles
    Often shipped around the world after manufacturing, connected vehicles benefit from the flexibility of eUICC-enabled eSIMs. The ability to provision vehicles remotely means they can be programmed after shipment to function with local networks in their destination country.
  • Industrial IoT
    Similarly, IIoT devices equipped with eSIM can be manufactured under a single SKU and then provisioned remotely once they reach their final destinations. And because IIoT applications often require longer hardware lifecycles, the adaptability of eSIM is another advantage — ensuring that devices are future-proofed against upcoming network sunsets and regulatory changes.
  • Micromobility
    Like the above examples, devices installed in micromobility vehicles like e-bikes and scooters also need to be provisioned after they are manufactured as they will be deployed indifferent urban areas around the world. The eSIM allows managers to deploy carrier settings and firmware updates OTA once the vehicles are in place. Additionally, since eSIMs are embedded, they are more durable, last longer, and help guard against theft, making them a great fit for micromobility applications.

How do I choose an eSIM partner?

In a global market with many different solution providers and partners, choosing the eSIM partner that’s best for your organization can be challenging. Here are a few questions to consider when you’re evaluating a potential eSIM partner:

  • Are they willing to work with multiple carriers?
    When a provider is neutral in the market, they’re working to integrate with carriers from around the world. They’re willing to take a profile from your connectivity provider and load it on for you. They might even offer an open application programming interface (API), making it easier to develop the eSIM options you need to automate processes within your ordering system or customer portal. If you’re deploying an IoT project globally and at scale, that kind of openness and flexibility can be a tremendous help.
  • Is there variety and depth in the technology and plans they offer?
    Depending on your organization’s needs and device use cases, you might need only eSIMs or a combination of eSIM and regular SIM cards. Look for a partner that can provide everything you need—because the last thing you’ll want to do is juggle multiple providers and carriers. Also, consider device management platforms and developer tools. Some providers restrict access to these, offering them only for large-scale deployments, while others allow full access even if you only need to connect one device. Data plans are another variant to consider—you’ll want to find one that’s adaptable, so you’re not paying for more than you need.
  • Do they use a carrier direct or MVNO model?
    Large mobile carriers sell connectivity directly to IoT users, but they cannot offer the same level of coverage and flexibility that an MVNO (mobile virtual network operator) can. An MVNO is a third party provider who has negotiated agreements with several mobile network operators to gain access to multiple networks. The combination of network options creates wider coverage for devices and typically eliminates roaming charges. With an MVNO, your eSIMs can automatically switch between carriers as they move from one area to another.

When can I start using eSIMs?

The eSIM is already available in the consumer smartphone market, and it’s rapidly growing into the IoT space. As companies scale to massive IoT deployments, eSIMs will become an essential piece of the puzzle.

How does Hologram fit into the new wave of eSIM technology? Our mission has always been to connect everything, everywhere. Because there’s not a one-size-fits-all approach for every area, we leverage multiple networks and partnerships with carriers to unlock opportunities in different regions of the world.

Hologram now provides eSIMs that are eUICC-capable. This aligns with our core vision of a world with simple, universal connectivity. If you’re ready to join the eSIM revolution, we’re here to help.‍

Get started with Hologram today

  • Talk to an IoT expert
  • Receive a free SIM
  • Customize your plan