The intersect of things: The perfect storm poised to disrupt carriers

Wireless companies have been no stranger to disruption. From the introduction and mass proliferation of the smart phone to WiFi and 5G, each phase of disruption has placed consumers increasingly in the driver’s seat.

However, today’s mobile operators have been subject to more intense disruption than ever before. Not only have operators needed to bob and weave to support customers and communities impacted by COVID-19, but major tech forces behind the scenes have converged to create a new perfect storm for mobile service providers. We are calling this storm ‘the Intersect of Things’ – which describes the explosive growth and self-fueling cycle that occurs as IoT, eSIM, digital identity and blockchain collide.

Internet of Things

We’ve been talking about the evolution of IoT for a number of years now, including the astronomical growth that comes with massive IoT and machine-to-machine (M2M) connectivity. It’s estimated that by 2025, there will be more than 41 billion connected devices, from smartphones and smart speakers, to networked streetlights and climate control systems. The challenge of identifying and managing individual devices within a networked M2M ecosystem or a smart city, however, has provided the catalyst behind eSIM – embedded/virtual sim cards. In M2M applications, eSIM makes it possible to maintain and calibrate a network containing thousands of IoT devices — which may be spread out over an entire metro area — from one remote location.

eSIM

While eSIM is a lifesaver for CSPs offering M2M connectivity, eSIM is also anticipated to create a seismic disruption for mobile carriers when paired with mobile phones. With a virtual sim card, mobile phones no longer need to be tied to just Verizon or AT&T with a specific plan. Each SIM card can have multiple carriers and multiple data plans. Apple and Google have started outfitting their newest smartphones with eSIM cards and the mobile eSIM market today is expected to see 37.5% CAGR year over year. By 2024, it’s estimated that more than 612 million eSIM-equipped smartphones will be in circulation. Even in the last year, growth projections for eSim have skyrocketed and it is anticipated to be a bigger and more pressing disruptor than initially expected.

The beauty of eSIM is that one virtual card will allow for multiple vendors and multiple plans over multiple devices. Tomorrow’s evolved consumer will not want to physically go into a store to buy and swap SIM cards. This customer will want to do everything online, which will provide a catalyst behind the growth of digital identity.

Digital Identity

If the virtual SIM card is to become ubiquitous, it must work in concert with an individual’s digital identity, which comprises all the data associated with them online.

The implications of a digital citizenry are immense for mobile operators and customers alike. But humans are only one part of the digital identity equation. In fact, networked devices in homes, businesses and cities will have unique digital identities as well. Your automobile will have a singular identity which communicates with that of the garage door and the house lights. The door will only open for your car and its unique digital identity, and the lights will follow suit.

This development will inevitably pack tons of sensitive data into centralized locations, perhaps even on a single device. This introduces a major concern with regard to security and authentication: can the storage of digital identity be safeguarded against malicious hackers?

Blockchain

Thanks to blockchain, the answer is yes. By this point, blockchain is a household name. It’s been lauded as a revolutionary shift in digital security thanks to its decentralized nature. Several countries, including the United Kingdom, United Arab Emirates, Ghana, Kenya and Nigeria, have deployed blockchain technology to manage and secure their citizens’ identities. Blockchain, in these countries, is now powering smart cities — a fundamental area of IoT.

The self-fueling cycle completes: IoT fuels eSIM which is a key driver behind digital identify, which is dependent on blockchain, which helps fuel the growth of smart cities and IoT.

Digital Customer Experience 2.0

These trends are not new and many of us have been talking about them as individual entities or in sets for a while. However, the self-fueling cycle between IoT, eSIM, digital identity, blockchain and back to IoT increases the industry impact of each trend, increases the speed of disruption and provides a catalyst for a more empowered digital citizen than ever before.

Tomorrow’s digital citizen will be able to use their mobile device as official identification for international travel, banking and more. They will have complete freedom of choice and access to any vendor, any plan, any device, anytime and anywhere – providing a catalyst for ‘customer experience on steroids’ as companies will need to compete in a new commoditized market based on the strength of their customer experience and value propositions.

The 2010s were a decade defined by a consumer uprising and a commoditized coup d’état of the cable industry. In 2020, it is already apparent that consumers are growing more powerful as they gain complete freedom of choice and look to do business with companies who put a premium on customer experience. Whether this is seen as an opportunity or threat will be for mobile operators to quickly decide.