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Challenger mobile providers are the big winners from the roll-out of eSIM technology in Australia. eSIM capability enables a ‘virtual SIM card’ on compatible devices and will be the standard means of mobile connectivity over the coming years .
For new and existing Mobile Virtual Network Operators (MVNOs), eSIM offers plenty of opportunities to ‘connect and serve’ mobile customers.
Globally, the eSIM market is expected to reach $16.3 billion (USD)by 2027. But within this large total market are several key niches that play into the strengths of eSIM.
We expect these niche markets to offer greater growth potential, compared to generic postpaid offerings. If you are a mobile provider, you should consider your eSIM strategy with particular focus on the following use-cases.
We see a significant opportunity for MVNOs to serve international students and temporary residents coming into Australia.
Students and migrants are underserved by the major telcos. Often they wish to organise mobile SIMs ahead of entering Australia but may have trouble finding service providers in their home country. By default, they are left with expensive international roaming services.
We see an opportunity for MVNOs to partner with migration and international education providers to fill this gap. There is a huge potential market to offer eSIMs to migrants and students.
Australia is top destination for university education. International students come from all around the globe. Plus, inbound migration is increasing. In 2022-2023, the number of migrant arrivals increased from 737,000, up from 427,000 the year before.
eSIM connectivity offers several advantages for students and migrants – which MVNOs can lean into when serving this market.
First, choosing a local mobile plan is typically better value than international roaming. Roaming services can be quite restrictive. By contrast, local Australian mobile plans support key features like uncapped calls and messages, 5G data, and monthly data banking.
Second, international customers can keep their home country number (if their device supports dual-SIM). So they can have both a home country number and their new Australian mobile number on the same device.
Finally, eSIM can be organised ahead of departure. With the power of eSIM, users can easily download and install a new mobile service in the comfort of their home or even the departure lounge. So it is ready from the moment they land.
We see a large potential market for eSIM as a tool for sole traders and small business. This niche is a surprisingly large addressable market. More than 60%of Aussie businesses are sole traders. While more than 97% of business are classed as ‘small’ (employing fewer than 20 staff). Importantly, eSIM-based mobile services solve a major customer pain point: how to separate work and play.
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For many small businesses, their communication system is often just the owner’s mobile phone. As any business owner will tell you, this approach comes with a few trade-offs. Including reduced privacy, higher phone bills, and the headache of calls and messages at all hours. And while many Australians have a dedicated 'work’ phone, this only increases the inconvenience.
By contrast, eSIM enables small business owners to have a second number on their mobile (provided it supports dual-SIM). On some Apple and Samsung devices, dual numbers can be managed easily, without needing any extra apps or call diversions.
With eSIM, small business owners enjoy the convenience of a single device while keeping ‘work’ and ‘personal’ separate. MVNOs and telcos that serve small businesses should consider how they can turn this insight to their advantage.
Another opportunity made possible by eSIM is the ability to ‘share’ a mobile number across multiple devices. Provided that the device is eSIM-capable, customers can use it to make calls and receive messages via their usual mobile number.
We believe multi-device consumers could be a growth market for MVNOs. Aussies love tech gizmos, and are keen adopters of new technology. This includes smartwatches, and smart speakers. Smartwatches are forecast to grow by 20.5% by 2026. There are over 22.77 million phone subscriptions in Australia and covering over 98.82% of Australians mobiles in 2021.
For telcos and MVNOs, number sharing is a revenue growth opportunity. Number-sharing plans enable providers to charge for each additional connected device. Typically, the charges range from $5/month to $20/month depending on the device.
Number-sharing plans have been adopted by consumer telcos around the world. For example, Verizon Number Share; T-Mobile DIGITS; One (NZ) OneNumber; and AT&T NumberSync.
Number sharing is not yet available to MVNOs in Australia. However, Telcoinabox is currently developing this capability and will release it in the near future. You can leave your details with us to be notified when it is available.
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eSIM is one of the most exciting things to happen to the Australian telecom industry in recent years. We see it as a game-changing capability that can unlock MVNO growth.
For challenger telcos and MVNOs, eSIMs make it faster and easier for customers to move away from the incumbent mobile networks. When you understand the advantages of eSIM you can also see how it can be used to offer new value to certain markets.
For students and migrants, eSIM offers communication certainty ahead of their move to Australia. For small businesses, eSIM helps them separate work and play. And for tech-loving consumers, eSIM unifies all their devices with a single number.
Best of all, eSIM has much more to offer. The three market niches we have explored here are just the beginning of what is possible.
If you area mobile or communication provider (or aspire to become one) Telcoinabox makes it easy to provide eSIM services in Australia. Our proven software platform powers hundreds of successful communication businesses, large and small.
Learn what’s possible today. Contact us to discuss your business plan.
