Back in November 2011 Apple quietly applied for a patent that would allow future iPhones to use a ‘Virtual SIM Card’. Apple’s reasoning was that it would like to provide its iPhone users with the ability to purchase and use wireless network services without the need of a SIM Card. According to Apple, a secondary benefit of switching to a Virtual SIM Card was to improve security and for it to be able to utilize the wasted hardware space.
All good for Apple but alarm bells went off throughout the service provider world and the backlash was so great the whole idea seemed to die a quiet death. Well, until the release of the iPad Air 2 and Mini Air 3 that is!
With very little fanfare, Apple snuck a reprogrammable or virtual SIM into those devices allowing users to switch between data plans without the need to get a new SIM for each operator. The technology would, presumably, also make roaming more user friendly, giving consumers the option to subscribe to short-term data packages with a local service provider when traveling abroad — without the bother of having to purchase and change SIMs for each operator/market.
Mind you, anyone can do the same now if they have an unlocked iPhone/iPad and a ‘SIM only’ data plans from an operator. Whether it’s easier to select and provision a network from the iPhone Settings menu or swap out a SIM card is neither here nor there, the fear of rescinding control of the SIM to Apple is what is at stake here.
But not all operators seemed phased by the announcement. All the US operators (with the exception of Verizon) and EE in the UK were launch adopters, however, AT&T has since announced it is not supporting this interchangeability and is locking the SIM after it is used with an AT&T plan.
It is easy to understand the operators' fixation with the SIM and their control of it. We don’t have to go too far back to recall the days of analog mobile phones limited by their ‘unique’ IMEI numbers that fraudsters managed to clone. The device in those days was tied to the operator but when you changed phones you had to have your device re-provisioned on the network.
SIM cards provided more security and more flexibility but were issued and controlled by the network operators. Despite their many attempts to coax mobile payment providers and others on to the security afforded by the SIM it is still largely used for only one purpose - to tie the subscriber to the network.
Any threat to this control is sure to be met with opposition but Apple’s reasoning is that once its SIM is provisioned with one network it would, for all intents and purposes, be controlled by that network. However, if the user is only interested in a short-term pre-paid contract the operator would release the SIM at the end of the contract and they would be free to link to another network without any cost implication to the operator in providing and distributing SIMs.
The operator community has mixed feelings about the introduction of the Apple SIM taking a ‘damned if you, damned if you don’t‘ attitude, Will it make it easier for Apple to seize control of the customer, will it herald the start of Apple acting as an MVNO, will it make customers less loyal? At the moment we are only talking of data traffic on an iPad but what if Apple were to extend this feature to the iPhone?
Perhaps the operators should be more concerned about another iOS features that allow users to make and receive phone calls on any Apple device as long as their iPhone is running iOS 8 is on the same Wi-Fi network. Incoming calls show the caller’s name, number, and profile picture can be answered on any of the devices and making a phone call from your iPad or Mac is just as easy.
This takes tethering to a whole new level. Users can have their own private exchange with only one network connection and the competition for that could become quite fierce. But if the Apple SIM becomes the ‘identifier’ how long before Apple uses it to recognize a roamer and automatically connect them to a local network that Apple has a relationship with. Then it’s only a small step to billing the user on behalf of the local network operator and taking full control of the customer in its own ecosystem.
This is all possible and most probable, but what can stop Apple’s momentum that is driven by making the customer’s life easier and happier and can networks ever be as popular as the devices that attract Apple’s loyal customers? Only time will tell.