For the next three years, the eSIM adoption will be shaped by the following factors.
- A decisive rise of the use of eSIMs in smartphones will balance the attention on eSIM between consumer segments and the enterprise IoT segment.
- In the enterprise IoT segment, cars will remain the key adopter of eSIMs.
- The key driver of eSIMs outside of connected cars will be in commercial vehicle tracking and asset monitoring.
- Smart meters will not grow rapidly due to regulation, fragmentation and long lifecycles and deployment times for technology in this sector. It will remain an important segment, but will not boost the adoption of IoT eSIM. Any acceleration will be driven by the less fragmented smart energy and gas market, while the smart water metering segment will be much more difficult because of market fragmentation and regulation.
- eSIM in the IoT context will largely remain a matter of adoption for large enterprises, i.e. organisations with more than 250 employees and, in many cases, with international operations.
Based on those assumptions, the chart shows STL Partners’ expected breakdown of the eSIM market by segment in 2023.
We expect the eSIM market to grow rapidly between 2020 and 2023, passing from 195.5 million eSIMs in 2020 to 364 million eSIMs installed in 2023, with eSIM for consumers (smartphone, tablets, laptops, consumer wearables) increasing from a 26% market share in 2020 up to 41% by 2023. Aside from uptake in the consumer segment, we do not foresee a dramatic change in pace of adoption of eSIM in enterprise IoT (cars, smart meters, other IoT devices).