The wireless world is changing, and quickly. From devices to applications, network infrastructure to how connectivity is managed and sold, nothing stands still in the cellular space. In this report commissioned by the MVNOs Series team, we explore where MVNOs sit in the shifting ecosystems that are emerging, where they are best placed to add value and the costs and challenges associated with the technology.

One of the biggest factors driving transformation in the global mobile market is the Internet of Things (IoT). After years of being touted as the next big thing, Machine-to-Machine (M2M) connectivity is finally coming of age, driving the ‘smart’ era of networked appliances, cars, factories, homes and cities.

IoT is set to take connectivity to the next level. It will no longer just be smartphones, PCs, laptops and tablets competing for bandwidth. Electrical devices of every type are liable to join in the next phase of internet evolution.

Gartner estimates that by 2020, the number of connected devices in existence will reach 20.4bn, and by 2025 it could be as high as 82bn. Verizon put the total amount spent in 2017 on networked endpoints and related services at $2 trillion. By 2020, some analysts believe the IoT market will be worth up to £6 trillion in investments.

A key factor in the growth of IoT is emergence of embedded SIM, or e-SIM, technology.

Removable SIMs have suited the consumer mobile market well. But for device manufacturers, removable slots add costs, while the need to change SIM or network provider manually creates complexity.

Beyond smartphones, managing mobile connectivity for other devices demands new solutions. The e-SIM, with the remote provisioning standards created by the GMSA, provides the simplicity and flexibility required.

This is why e-SIM is described as the key enabling technology behind IoT. As Suresh Kumar, Senior Chief Engineer at Samsung Electronics, puts it: “IoT is the future, and the e-SIM is the entity which would drive for the success of IoT”.

As things stand, IMS has calculated that there will be 150 million devices connected by e-SIM by mid-2018. But this is predicted to increase at enormous speed, reaching almost one billion shipments as soon as 2020. This will be driven both by increased adoption of M2M technology, but also by e-SIM in the consumer market, as the IoT creates more and more crossover between B2B and B2C markets.

This represents a once-in-a-generation opportunity for the mobile operator sector. Every single networked device requires connectivity services, many of them – from smart cars to consumer wearables – obviously demanding mobile, wireless connections. And with 5G on the horizon, there is an opportunity for cellular to become the new standard, offering seamless, reliable connectivity everywhere you go.

IoT represents a brave new world for MVNOs, quite different in many ways from mobile operators’ traditional stamping ground of consumer voice and data services. But for a sector that lists agility and ability to innovate amongst its main strengths, responding to new and evolving niche demands is perhaps the perfect opportunity.

In this report, we outline some of the main opportunities for MVNOs, as well as analyse the challenges that need to be overcome.

Given that e-SIM and remote provisioning loosen the control mobile operators have thus far enjoyed over network access, raising the prospect of SIM manufacturers and OEMs providing connectivity services directly, we will ask who is best placed to make money from IoT connectivity. We will assess where MVNOs sit in the shifting ecosystems that are emerging, where they are best placed to add value and what new business models are likely to emerge.

Download the full the report and discover how IoT and eSIM together represent a once-in-a-generation opportunity for the mobile operator sector.

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