eSIM Poised for Strong Growth

Over the past two years, one of the most popular areas of our research has been eSIM.

A leading reason is that our clients are looking to understand the impact of Apple’s decision to launch an eSIM-only iPhone, a move that will be a major catalyst for the technology. But we’ve seen interest in many other areas, such as how fast people will adopt eSIM, what the technology means for operators, whether consumers understand it, and the significance of the burgeoning market for eSIM roaming.

CCS Insight’s Spotlight report answers all these questions and more — if you’d like a copy of the report, please contact us. Published at the end of May, it reveals a technology on the cusp of bringing about indelible changes to the way people connect with mobile providers and manage their cellular subscriptions.

A key driver for the technology is smartphone support. Led by Apple, this will more than double from 1 billion enabled phones at the end of 2023 to 2.5 billion in 2028, according to the report. Over the same period, the share of global sales of smartphones compatible with eSIM will jump from just over a quarter (27%) to more than a half (56%).

The research also tells how operators have become more accepting of the technology. In the past, some were reluctant to support eSIM in smartphones, fearful of conceding relevance to big tech rivals, encouraging new competitors and losing roaming revenue.

Among several benefits for operators explored in the research is lower costs. The average cost to deploy an eSIM is about a fifth of that of a physical SIM card, and by 2028 this could result in industry savings of more than $3 billion based on our market forecasts. Other advantages for operators include simplifying customer journeys, luring customers from rivals and reducing the industry’s impact on the environment.

One of the growing uses for eSIM is international roaming. Our analysis shows that a flood of specialist providers has entered the market in recent years, offering more convenient and affordable options to access mobile data when travelling. The report charts strong growth in the number of roaming eSIMs set to be provisioned over the next few years, after eSIM roaming doubled in 2023. This is supported by CCS Insight’s own consumer research*, which shows that one in 10 people in five leading markets have already used an eSIM for roaming. Of those yet to do so, more than 60% said they would consider taking an eSIM for roaming in the future.

Probing into people’s interest and awareness of eSIM, our research offers encouraging findings as four in 10 people said they had heard of eSIM. When we explained the concept to respondents, over three-quarters said they would be interested in eSIM.

However, some of the main benefits are not fully understood, highlighting a major challenge for the industry. As momentum for eSIM gathers pace, focus should increasingly turn to support people embarking on new customer journeys, particularly those who are less confident using new technology. It could be that those companies best able to guide their customers along this path will end up being the most successful.

* The research was conducted in March 2024 in the UK, the US, Germany, Spain and Australia. The sample consisted of a minimum of 1,000 respondents in each market and was nationally representative in each by age, gender and region.