Chief executives from some major international mobile operators tackled the thorny issue of embedded SIM technology earlier this week at Mobile World Congress and found that they were not in complete agreement on the subject.
The topic took centre stage at the conference in the wake of last week's announcement from the GSMA that it has released a specification to enable consumers to remotely activate the SIM embedded in devices like smart watches and tablets. The specification is backed by a raft of telecoms operators and vendors, the industry body said, but it also raises concerns for the telco community.
The embedded SIM is "really a challenge" for mobile operators, suggested Boris Nemsic, a consultant at Delta Partners and formerly chief executive of Vimpelcom and Telekom Austria. While the embedded SIM is currently being discussed in the context of the Internet of Things (IoT), it could easily migrate to the smartphone space, giving customers more freedom to chop and change between operators.
"If it makes sense for the consumer, it will happen," and operators won't be able to stop it, said Tele2 CEO Allison Kirkby.
She agreed with Nemsic that it would be a challenge for the telcos, but noted that the onus would be on operators to ensure that they offer the right digital experience so that customers are willing to select their network for their smart SIM.
Glenn Lurie, chief executive of AT&T Mobility, disagreed with Kirkby though.
The first phase of embedded SIM is geared towards IoT, tablets and devices with "no need for a hard SIM," he said. Smartphones would come in a second phase, he argued, with many more details to be ironed out before it happens.
The key issue is "who owns the credentials," he said. On a standard operator-distributed SIM, the operator holds the credentials, but an embedded SIM begs the question, who can change the IMSI on that SIM? he said.
There is a lot to be worked through before the embedded SIM comes to smartphones, he said. And, as always, "the devil is in the details."
Lurie is not the only one to remain relatively unconcerned about the potential threat from the embedded SIM.
"I don't worry about it," said Khaled Biyari, group CEO at Saudi Telecom Company (STC).
Like Kirkby, he believes that the customer experience is ultimately the deciding factor, so it is in the operators' power to retain subscribers.
Mobile number portability is very easy in Saudi Arabia, yet "very few people migrate," he said.
Nemsic is not so sure though. He pointed out that multiple SIM card usage is very popular in some markets, therefore an extreme extension of that could be a customer using an embedded SIM to gain better rates – effectively making different calls with different identities.
The multi-ISMI scenario "changes the complete dynamics of the business," said Lurie.
It changes the cost structure of providing a service, and as operators "we want a fair return," he said.
Telcos working together is a solution, but "we have to be very careful."
Source: http://www.totaltele.com/view.aspx?ID=492952&G=1&C=1&page=2