Apple Poses a New Threat to the SIM Card – Alex Webb
(Bloomberg Opinion) -- Each new iPhone is usually good news for mobile network operators. The latest Apple Inc. device always comes with upgrades that make it easier to play games, watch films and download reams of data. More data means bigger phone bills.
There’s a chance, though, that Wednesday’s arrival of the next generation of iPhones might not be so welcome. That’s because there’s a possibility that Apple could introduce so-called electronic sims, or eSIMs. Even if this doesn’t happen this time around, the shift to the new technology looks inevitable.
Speculation about eSIMs has been rife since Apple complained to the U.S. Department of Justice that Verizon Communications Inc. and AT&T Inc. were colluding to prevent their introduction. The DoJ is investigating.
The classic SIM card is a small chip that’s inserted into the phone manually – making it more awkward to change your mobile network provider. You have to go to a shop to get a new sim or have one delivered physically. The eSIM is virtual, meaning that just changing your phone’s settings would theoretically allow you to switch carriers.
It’s almost certain that this would accelerate price competition. Whenever it’s made easier to jump from one operator to another, consumers take advantage and seek better deals. “Churn,” the industry term for customer losses, spikes. That’s what happened, for example, when Spain brought in rules to cut the time it took to change network operators to less than 24 hours.
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(Note: Alex wrote his column before Apple unveiled its new phones. As he suggested might happen, the devices have a dual-SIM system, keeping “the classic SIM port alongside an eSIM”.)
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The Tobin Harshaw Old Music Endowment
The No. 1 album in the U.S. this weekend in 1998 was “The Miseducation of Lauryn Hill” by South Orange, New Jersey’s own Lauryn Hill.
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Mark Gongloff is an editor with Bloomberg Opinion. He previously was a managing editor of Fortune.com, ran the Huffington Post's business and technology coverage, and was a columnist, reporter and editor for the Wall Street Journal.
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