Catalysed by the GSMA SGP.31/32 specifications, eSIM technology is primed for mass adoption, particularly on LPWAN devices.

”The new GSMA SGP.32 eSIM specification was much needed and has been specifically designed for IoT. It offers significant advantages in terms of cost, flexibility and longevity for hardware OEMs, finally beginning to bridge the gap between traditional consumer device provisioning and more traditional IoT devices,” said Omdia practice lead IoT Andrew Brown.

“This will help to accelerate adoption in key industries, not only those that have long desired eSIM standardisation, such as automotive, but in a multitude of others also.”

It also has been adopted in smartphones and smartwatches. Constraints on power, computing, and end user intervention have stymied the ability of IoT enterprises to take full advantage of this technology, but companies are finding a way to reduce these hurdles as solutions come to market, paving the way for more innovative adoption.

IoT adoption trends such as 5G RedCap, 5G massive IoT, 4G LTE Cat-1bis modules are also driving demand for eSIM.

“eSIM technology has long been seen as an important form factor for IoT devices, but now we are seeing the technology improve in ways that help enterprises provision over-the-air in resource-constrained IoT devices,” said Omdia IoT principal analyst John Canali.

“This will create greater competition between communication service providers (CSPs), as IoT enterprises are less subjected to vendor lock-in by the CSPs and are better positioned to renegotiate connectivity tariffs.”

Omdia surveyed 700 global IoT enterprises in which nearly 90% of respondents planned to adopt eSIM/iSIM technology over the next two years.

Aside from tighter security, IoT enterprises value the benefits of eSIMs to create more complete/reliable networks, manage costs, and to easily comply with local regulations.