Should mobile network operators (MNOs) and mobile virtual network operators (MVNOs) adopt embedded subscriber identity modules or eSIM technology?
According to Juniper Research, the eSIM market size was $212 million in 2021. This is projected to become $1.2 billion in 2025, with an incredible compound annual growth rate (CAGR) of 54.14%. Counterpoint also estimates there will be more than six billion eSIM devices by 2025, from one billion in 2020.
Based on the above, network operators must adopt eSIM and do it soon to stay ahead of the eSIM growth curve. An eSIM provider can help if you’re an MNO or an MVNO thinking of doing just that.
Once an MNO or MVNO has decided to provide eSIM support to their subscribers, it must resolve whether it will rely on an eSIM provider or not. Now, to choose whether to obtain eSIM management as a cloud-hosted service from an eSIM company or to perform eSIM management onsite.
Cloud-Hosted eSIM Management Service
In the cloud-hosted eSIM management model, the eSIM provider provides its eSIM management software and facilities as a service to MNOs and MVNOs.
The eSIM management company owns the eSIM infrastructure. This includes the cloud servers, the software that runs on these servers, and the technology that the network operators need to provide eSIM services to their customers.
The network operators lease access to this infrastructure on an as-needed basis. In this setup, the MNOs and MVNOs pay only for the resources they are using (or have reserved the use of), and they can add services and options as warranted by their subscription volume and network demand.
Pros of Cloud-Hosted eSim Management Service
These are the benefits of a cloud-hosted software as a service (SaaS) eSIM management solution.
1. Get up and running quickly.
Cloud-hosted eSIM management allows telcos to deploy eSIM services quickly. The infrastructure already exists. MNOs and MVNOs simply have to integrate it into their business operations.
2. Offer eSIM support with minimal upfront investment.
Cloud-hosted eSIM management is cost-effective because it lets network operators offer eSIM support without having to invest heavily in eSIM infrastructure.
3. Scale with demand.
The SaaS model is flexible as it lets telcos scale with eSIM subscription volumes. They can lease only as much resources as their subscription volume warrants.
4. Minimise downtimes.
Cloud-hosted eSIM management services have redundancy servers in different parts of the globe to minimise service disruptions in case the primary infrastructure becomes dysfunctional for any reason.
5. Minimise personnel expenditure.
The eSIM provider is in charge of maintaining its infrastructure. Network operators don’t have to pay people to maintain servers and data centres.
Cons of Cloud-Hosted eSim Management Service
The following are the disadvantages of cloud-hosted eSIM management.
1. Network operators don’t own and control the infrastructure.
The eSIM provider owns the infrastructure. Network operators have only as much control as the eSIM company allows.
In the cloud-hosted SaaS model, network operators may only work within the bounds of the infrastructure. They cannot implement solutions from scratch; they can only modify the existing technology to their requirements.
2. Cloud hosting may not satisfy data protection regulations in some territories.
Some countries require network operators to keep subscriber data within the country and not transmit them beyond state borders. This is a rule network operators won’t be able to follow if they obtain a cloud-hosted eSIM management service. Cloud eSIM providers keep data in multiple data centres around the globe for redundancy purposes.
Onsite-Hosted eSim Management Service
A network operator can provide connectivity and remote provisioning services to its eSIM subscribers through its own data centres. This is what onsite hosted eSIM management means.
In the onsite hosting model, the network operator builds, owns and controls its eSIM management infrastructure. Essentially, the operator becomes its own eSIM provider instead of outsourcing eSIM management to another company.
Pros Onsite-Hosted eSim Management Services
The following are the benefits of onsite hosted eSIM management.
1. Own the infrastructure.
The network operator owns the infrastructure. Therefore, onsite hosting affords network operators absolute control over their eSIM provisioning, connectivity and services.
2. Customise solutions as needed.
Since the network operator owns its infrastructure, it can design its architecture the way it wants and create the solutions it needs. MNOs and MVNOs can commission the development of proprietary software as their requirements demand.
3. Exercise control over the security of the infrastructure.
When their servers are onsite, network operators can implement the security measures they deem necessary to protect their data, minimise their risks and reduce their liability.
4. Keep data inside the country.
Onsite hosting ensures compliance with territory-specific regulations requiring network operators to keep subscriber data within the country.
Cons of Onsite-Hosted eSim Management Service
However, onsite hosting also has a number of disadvantages.
1. It is expensive.
The capital expenditure required can be substantial when a network operator has to build its onsite infrastructure from the ground up. It can also take time before the operator sees any returns on its capital investment.
Aside from the significant capital investment, the Security Accreditation Scheme (SAS) approval also costs more than $100,000.
2. It can take a long time to begin operations.
It can take one to two years before the Global System for Mobile Communications (GSMA) can audit a network operator’s onsite eSIM management facility. This translates to an operator sitting for up to two years on its capital investment before it can begin to realise any returns.
3. A technical team is required to maintain the infrastructure.
Network operators with onsite eSIM management are in charge of maintaining their infrastructure. As such, they must employ a dedicated team of personnel for technical maintenance.
Which Is Better: Cloud or Onsite Hosting?
Network operators must assess their particular needs and decide which solution is a better fit. Of course, they can also go for a third solution: setting up onsite servers but using them with a ready-to-deploy eSIM provisioning and management platform from an eSIM provider.
