In December 2024, eSIM Go announced a partnership with Vodafone UK that claims to support almost any organization to become a mobile virtual network operator (MVNO). The deal means that your favourite discount travel airline, football team or “any organization with a subscription model” could soon offer a mobile plan using eSIM technology.
An eSIM is a digital SIM card pre-installed on a cellular device that replaces the need for a physical SIM card and tray. The technology has numerous advantages, including improving customer journeys and having a lower environmental impact. Adoption is growing rapidly: CCS Insight forecasts that by 2025, there will be 9.1 million eSIMs in the UK.
eSIM Go has over 300 active MVNO partners worldwide, including Lufthansa and Western Union, and a significant number of affiliates. It offers three routes to market and recently expanded its proposition by partnering with Vodafone in the UK. eSIM Go will use the Vodafone network, which is set to be enhanced in the merger with Three, and offers businesses the option to become MVNOs and sell to enterprises and consumers. The deal allows the eSIM Go-facilitated MVNOs to offer 4G and 5G technologies. Notably, they can’t offer 5G standalone at this stage.
We believe Vodafone has partnered with an eSIM facilitator to diversify its offering at a time when the MVNO market continues to grow. For Vodafone, the partnership offers a potential route to revenue growth that can exploit its hefty investments in mobile networks.
Some sectors are well-suited to benefit from the eSIM service: companies in the travel sector, for example, can offer deals for holiday-goers, with an excellent opportunity to upsell a data package alongside booking flights or accommodation. Streaming services could also use the service to add value to their service plans when consumers are trying to reduce the amount they spend on streaming. Our latest research revealed that 23% of UK consumers plan to spend less on streaming services in the next 12 months.
In a call with CCS Insight analysts, an eSIM Go executive highlighted several other examples, including football clubs, retail brands, alternative networks and charities. I found the latter particularly interesting and refreshing as an opportunity to bring in revenue when finances are stretched. Although our research indicates a slight improvement in respondents’ assessments of their financial situation, some charities have reported that donations fell by more than half during the peak of the cost-of-living crisis.
The eSIM Go–Vodafone deal could enable charities to offer mobile plans to consumers and receive regular monthly revenue through a commission-based structure, which could support new projects. Furthermore, we expect that the subscriber churn rate will be low as customers will want to continue supporting projects they care about.
However, launching an MVNO into a highly competitive market will be an ambitious endeavour for charities. They may look to the now-defunct charitable MVNO, The People’s Operator, as a cautionary tale. The MVNO allowed customers to support charities and non-profits but shut down in 2019. An offering using the eSIM Go service could be more successful as consumers will buy directly from charities rather than a slightly detached ethical MVNO.
Traditionally, significant investment is required to become an MVNO. For charities in particular, this spending is often at odds with trustees who are more concerned with how money can be used directly. The eSIM Go proposition could help lower some of these barriers to entry.
As well as facilitating market entry, eSIM Go offers companies additional guidance. For example, travel affiliate partners have the option to build their own digital stores or develop a co-branded store with eSIM Go. Like other operators and MVNOs, eSIM Go also uses an AI agent; it can communicate in 15 languages and reportedly handles 94% of customer interactions.
The deal between eSIM Go and Vodafone creates a new revenue opportunity for many different types of organization. However, a few bold companies will need to show how to make it a success before others step forward.
For in-depth analysis of the global eSIM market and operators’ strategies, see our Spotlight report or contact us.