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New study shows 8-13% saving on lifetime connectivity spend from using eSIM/iSIM in IoT

JUN 20, 2022
region: ALL sector: ALL HyperconnectivityInternet of Things

Transforma Insights has published a White Paper, sponsored by Quectel, entitled 'Using eSIM and iSIM will save money for IoT deployments' which is based on an extensive set of research on eSIM, iSIM, remote SIM provisioning (RSP) and subscription management with a view to understanding which is the most cost-effective approach over the lifetime of the device.

Typical savings of 8-13% from eSIM/iSIM

The key finding of the research was that on average eSIM devices cost 8% less over the lifetime of the device on a like-for-like basis than those using plastic removable SIM. If that eSIM is part of an integrated module that moves to 11%. Even greater benefits come from iSIM, which is on average 13% cheaper than plastic removable SIM. The chart below represents the average lifetime cost of using most of the possible permutations.

Figure: Average cellular IoT connectivity and SIM lifetime spend


Each application has different dynamics

These averages mask a lot of variation in both market dynamics and resulting differences in costs. For instance, certain use cases will tend to avoid multi-IMSI SIMs because of the lack of standardisation. In other cases, NB-IoT is the favoured option of a particular application which will therefore mitigate against the use of RSP-based solutions. Furthermore, some use cases, such as automotive, demand ruggedised SIM cards, with associated additional cost. For this reason, the study examined each of the top 30 cellular IoT use cases separately, considering four key technologies, 4G, 5G, LTE-M and NB-IoT.

The White Paper presents the analysis for a range of permutations of application and technology to demonstrate the expected lifetime costs across a range of specific scenarios.

Enterprises need to consider total lifetime cost

Commenting on the findings, report author Matt Hatton said "Embedded SIM (eSIM), and to a lesser extent its coming successor integrated SIM (iSIM), have established themselves as part of the range of capabilities that need to be carefully considered by an organisation when planning a cellular-based IoT solution. Any enterprise will need to consider the overall lifetime cost of the device, with considerations of both direct and indirect costs of using the various options. In this report we examine nine costs that will determine which is the best option, including component hardware, subscription management, lifetime connectivity, logistics and compliance. All are relevant to the cost-benefit analysis of using eSIM. Overall we see there being significant savings for the average deployment from using eSIM/iSIM and RSP."

About the Research

To build its model of the cost of using the various types of SIM, Transforma Insights identified first the nine key cost elements that might be most prominently influenced by choice of SIM. These range from the component cost itself, to the future-proofing risk of the various options. Then, for each of the top 30 use cases (as taken from the Transforma Insights IoT Forecast Database) we analysed the cost elements for each of four different types of SIMs (eSIM, iSIM etc.) used in four different ways (single IMSI, multi-IMSI, RSP etc.) for the four main cellular technologies (5G, 4G/LTE, NB-IoT and LTE-M).

For each of those permutations of use case, technology, SIM type and deployment type we calculated the lifetime cost of supporting a connection of that type. This allows us to look at the variation is cost for each use cases as well as blended averages. Clearly some combinations will not be viable. Cars are not connected using NB-IoT, for instance, and some verticals will be predisposed against multi-IMSI products because they are proprietary. For this reason, in many of the analyses we will exclude unlikely combinations.

Download the White Paper 'Using eSIM and iSIM will save money for IoT deployments' for full details of the methodology and findings.