Technology evolution is smoothly progressing from the common plastic SIM cards to eSIM – rewritable digital modules built into the phone’s board at the manufacturing stage. Although trials have been going on since 2016, Russian operators have postponed the wide introduction of eSIM until the end of 2020. However, the COVID-19 pandemic should accelerate the transition to eSIM.
How will remote connection help subscribers and businesses in the event of a new lockdown, and why is Russia in no hurry to transition to electronic SIM cards?
SIM evolution
We are all familiar with Mini and Micro SIM cards that serve as unique identifiers for the subscriber to register on their operator’s network. If we want to activate a better mobile data plan, save on roaming or change the network provider, we need to purchase a new piece of plastic and insert it in the device.
However, a SIM card can be used to get wireless service digitally and remotely. The SIM credentials, necessary to sign on to the specific carrier’s cellphone network, are downloaded to a circuit already embedded in the device. The remote identification technology will primarily affect the way we buy SIM cards – a subscriber will no longer need to come to the operator’s office, as the registration and connection procedure will be performed online. Over time, this will inevitably lead to a significant shrinking in the retail segment.
For mobile operators, eSIM will simplify their customer service and broaden access to communication services. However, an eSIM instead of a physical plastic card will make it easier for users to change their service providers, switching to a more competitive offer without leaving home. Mobile operators will have to be more attentive to their customers to keep them on board.
The eSIM technology will also change the consumption pattern for roaming services. Subscribers arriving in a foreign country will be able to sign up to the services of a local mobile company remotely. Tourists will not have to look for outlets on the map or struggle with a foreign language to buy a SIM card. All it will take is scanning a QR code or clicking a button a couple of times.
Overall, the remote identification technology will cost cheaper. Mobile service providers will not have to spend money on making SIM cards (their average price starts at RUR 60 (83 cents) depending on the size, chip properties and network type. Around 100 mio SIM cards are sold annually in Russia alone. The economic effects will be tangible, to say nothing about the environmental aspect as the world will get rid of a huge amount of unnecessary plastic.
Virtual SIM cards will also bring new opportunities that will make it easier for subscribers to use mobile communication services. Signing up or replacing a broken SIM card still require visiting an office, followed by an annoying procedure of installing the SIM card into one’s device.
eSIMs make any such visits redundant and surpass their physical predecessor in terms of reliability – after all, an ordinary SIM card can get broken or damaged during installation. Users will not notice a difference between using an eSIM and a regular SIM card. The smart phone menu will even show the same image. But hacking or forging virtual cards is more difficult. A microchip replacing a regular SIM card is now embedded into the device during its assembly. Subscribers wishing to install or replace an eSIM will need to contact their mobile service provider who will be able to see the device’s entire history. The remote identification technology will thus allow authorities to exercise a more thorough control over stolen or counterfeit mobile phones that are imported into the country illegally.
A new system of remote identification will be developed for remote sales of SIM cards. While identifying the customer using their biometric data, the algorithm compares the provided information with the information in the database and verifies it. This will prevent customers from using unregistered SIM cards and will make the mobile services market safer: it would be more difficult to register a SIM card for another person. The system must be integrated with the Business Support Systems of the operator, in particular with the systems that are used to sell SIM cards and that are offered in the Bercut product portfolio.
In Russia
The eSIM standard appeared in 2016, followed by the first devices that supported the technology. European and US operators launched the technology in late 2018. In Russia, virtual SIM cards are not yet supported by operators due to legal restrictions. However, Tele2 managed to register eSIMs for its customers in a test mode.
The introduction of the technology requires certain preparations: changes in business processes, sales regulations and the operations of technology equipment plus the readjustment of all systems of the operator. Software developers also have to get ready to support remote identification.
As of now, only Tinkoff Mobile customers can use eSIMs. The operator received the permission from the Federal Security Service to sell electronic SIM cards. The comprehensive introduction of the remote identification technology in Russia is only possible with the signing of relevant regulatory acts whose development has been extended to 2020.
However, the legal aspect is only one of the blocking factors. The main cause is the unavailability of a full-fledged system for remote identification of users that should be an essential part of the process of eSIM sales. The system should comply with requirements for personal data protection and has to undergo numerous inspections by regulatory authorities before its launch for commercial use. This fact sidelines the priority for launch date to avoid subscribers’ data leakage.
Perfect solution amid lockdown
The COVID-19 pandemic and the global lockdown have shown the relevance of the remote identification technology. Currently operators have to provide delivery of SIM cards, which requires financial expenses. Users are not comfortable with this forced method as they become concerned about their privacy. Remote eSIM sign-ups aim to solve such issues for both businesses and individuals. Fear of increased tracking of smartphone users’ movements is unfounded. There are surveillance methods that have long existed without the use of SIM cards. It is no secret that mobile operators have monitored us since we purchased our first smartphones and started using them.
The use of the remote identification technology has a vast potential. According to analysts at J’son & Partners, the biometric technology market will show an average annual growth of 18.6% in the next few years; this is due an extensive development of advanced technologies and biometric measurement systems, as well as citizen’s readiness to share their personal data. Everyone is aware that this is ultimately done for security. Remote identification technologies are unlikely to protect us from another lockdown in case it occurs, but they will definitely make our life easier.
By Ivan Ryl, Product Director, Bercut