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IMS Research Analyst Blog
Jasper Wireless-based Operator Group Promotes "White SIMs" for M2M Market
Date: 19 March 2013
The cellular machine-to-machine (M2M) market is steadily moving away from fixed SIM subscriptions toward so-called “white SIMs” capable of over-the-air downloading of new subscriptions. At last year’s 2012 Mobile World Congress show in Barcelona, multiple SIM manufacturers introduced SIM subscription management platforms. As this year’s Mobile World Congress show opens, an industry alliance of eight mobile network operators that use the Jasper Wireless “Control Center” M2M connection platform have announced that they will support white SIM functionality in conjunction with Giesecke & Devrient’s SmartTrust AirOn SIM subscription management platform.
The eight alliance members (Etisalat, KPN, NTT DOCOMO, Rogers Communications, SingTel, Telefonica, Telstra, and VimpelCom) stress their openness to extending their alliance to operators that do not use Jasper Wireless’ platform. However, IHS believes that Jasper Wireless has played a key role in enabling the white SIM announcement, not only through the common management framework of the Control Center connection platform, but also by offering account management services between two or more operators in transferring subscriptions. It’s important to note that earlier this month (February 2013) Ericsson announced a similar offering for operators through the use of Gemalto’s SIM subscription management platform in conjunction with Ericsson’s own Device Connection Platform.
White SIMs are distinct from the concept of “soft SIMs” in that they retain use of an embedded hardware component, as opposed to being completely comprised of embedded software. This is a key point, owing to the operators’ concerns over the level of security that could be ensured by SIMs reliant on software alone, without an embedded hardware component. G&D’s AirOn platform, as well as other SIM subscription management platforms, is currently based on proprietary technology, but the GSMA is coordinating a standardization effort for white SIMs that IHS believes will lead to a white SIM standard by the end of 2013.
Reprogrammable white SIMs will play a key role in facilitating the use of embedded SIMs in the M2M market. The embedded SIM form factor itself has been crucial for M2M market development, given its robustness and manufacturability. White SIMs provide a number of other key benefits to the cellular M2M market, including:
- Supply-chain optimization for embedded SIMs used in single, global SKUs.
- Cost-optimization through tariff localization of globally-deployed SIMs.
- Easier compliance with local regulatory prohibitions against the use of foreign SIMs.
- In-country coverage optimization through utilization of the strongest local network signal.
However, the ability to download new subscriptions also poses a challenge for operators in the M2M market in that part of the business case for low ARPU (average revenue per unit) rests on long deployment time frames and little or no churn. If customers can change operators easily then this potentially could weaken the business case. It increasingly appears, however, that operators are making a calculated decision that the opportunity to grow the M2M market by optimizing the customer experience around global deployability, as outlined above, will outweigh the risk posed by customers switching subscriptions.
From a competitive standpoint, the eight operators in the alliance are positioning themselves for the increasing globalization of the M2M market against both large operators (e.g. Vodafone) and alternative M2M alliances (e.g. Deutsche Telekom, Orange Business Services, and TeliaSonera). Currently, Vodafone offers an extensive global footprint both through its direct operations in 30 countries in addition to 44 other countries in which Vodafone has formal partnerships with local operators in place. AT&T announced in December 2012 that it was using G&D’s AirOn platform to offer local in-country tariffs globally. To underscore the growing importance of providing a global footprint, IHS believes that Telefonica won GM OnStar’s business in Europe and Latin America largely on the strength of its ability to offer a single platform with access to a wide range of countries, especially in Latin America, in which OnStar wishes to expand its service. White SIMs will help operators to meet this growing demand for global deployability in the M2M market.
by Sam Lucero, Sr. Principal Analyst
Recent Communications & Wireless Postings
- 7th November 2013 - Sierra Wireless Acquires AnyData M2M Assets
- 29th October 2013 - Bill Morelli from IHS Technology to attend Georgia Tech’s Institute for People and Technology November 5-6, 2013
- 14th October 2013 - Orange Business Services Adopts the Ericsson Device Connection Platform
- 10th September 2013 - Telit Acquires M2M Application Platform Provider ILS Technology
- 9th September 2013 - Verizon Buys Out Vodafone: M2M Implications