Is eSIM really a good substitute for Roaming?

Looks like eSIM is back in fashion, well at least talking about it seems to be. Unfortunately, yet again the posts that I’ve seen either provide half-truths that are then extrapolated to far-fetched conclusions to promote self-interests, or they are from people who just seem to have discovered its existence, and don’t understand Roaming.

Comparing an eSIM used to substitute Roaming to Roaming itself is a much more nuanced discussion, rather than saying that an eSIM is cheaper, but it’s easy to bang the drum to create noise, especially if, like a little kid, you’ve just discovered it, and so people do.

Let’s make something clear, of course eSIMs are great, and have a place in the eco-system, what the heck, I’ll even agree that this is probably the beginning of the end of the traditional SIM. But the fact that they are going to kill off roaming is something akin to saying Facebook will kill the BBC or CNN!

Let’s look at what is the real benefit of eSIMs.

  1. Real Estate: For device manufacturers, there’s a lot to pack into the device, especially with high end smart phones which seemingly these days need everything from a gyroscope to a toilet tissue holder! … any space that can be freed up by a dedicated sim or dual sim slot is welcome.

  2. No more Barcelona scams: Probably the biggest and most profitable “theft type” was using the physical sims from stolen handsets to call high-rate premium rate numbers and generate termination revenue. This had become hugely popular in Barcelona. All the best trying to steal an eSIM.

  3. IoT: The biggest benefit perhaps will be in the IoT space. With massive deployments management of connectivity of these will definitely be much easier.

But to not only say but encourage the use of eSIM for roaming is either irresponsible, or just being ignorant.

With each post I’ve seen, the one and ONLY ONE benefit these posts seem to point at is the price advantage. Sure today, compared to some plans it might be cheaper to use an eSIM. But do you know what, it will be even cheaper to use WiFi, and even cheaper to just write a letter/postcard! … I hope you’re getting the point I’m making. If price is the only consideration, we would have stayed in the land of horse-carts and never seen a Lamborghini or even a Model T.

So, the people who are telling you that eSIMs will kill Roaming, probably don’t know that:

  1. Using Roaming means you get to use the same PHONE NUMBER that all your contacts have! I know it can get a bit confusing for people who live on WhatsApp … these are things that can be dialled from any part of the world from any phone. Both the caller and the called person DON’T HAVE TO be on the same OTT platform. Perhaps the greatest benefit that roaming offers. Even today when OTTs are so dominant, having one number that can be reached from anywhere offers a great benefit. For calling out as well, In many parts of the world, especially where spam calls are abundant, consumers don’t even take the calls if they don’t identify the number.

  2. A major cost for Telcos is the Customer Acquisition Cost, this could be in hundreds of dollars per customer. It’s easy enough to get a few customers, but to scale and be truly profitable to acquire customers is an expensive proposition. Unlike Roaming, where deals are done between operators through one-to-one relationships each operator getting thousands to millions of roaming customers on their network, eSIM providers will have to spend massive amounts just in marketing to attract customers to their specific platform. Can you imagine the cost of acquiring a customer for two weeks of Roaming in a year? A few years back, the EU commission came up with the bright idea of an Alternate Roaming Provider (ARP), where each MNO was obligated to enable a third party to provide roaming services to their customers … and guess what, it would still be the MNOs who would continue to provide the services, run the infrastructure and all the ARP was supposed to do was sell Roaming plans on a retail basis. Would you like to guess how many ARPs there are today? None, zilch, zero, nyet, nada, sifr ! (Trying to cover as many languages as possible as I’m not sure which language do writers of these spurious posts understand).

  3. Perhaps if the doomsayers did a little bit of research, they would find that in many countries and especially in the west which is the biggest contributor to Roaming traffic, most phones are sold through Mobile phone companies through contracts, and these are obviously locked to the provider and it’s not possible to change to a different provider for Roaming.

  4. Let’s come back and look at the price advantage that eSIMs for Roaming seem to offer. Is this a real advantage based on a fundamentally cheaper cost base that eSIM providers have? Obviously not, as the service is being supported by the same network (visited network) at the other end. If anything, as explained above their acquisition costs will make their cost base much higher, than a traditional MNO. With many operators moving to innovative bundles, where a day’s roaming can cost less than a cup of coffee, or just an additional fee per month gets you to use your domestic bundle while roaming, a small change in the roaming retail tariff can blow a big hole in the entire eSIM for Roaming business case. When it comes to fundamentals, there isn’t a cheaper way than roaming to provide connectivity, for four very simple reasons:

    • A) No middleman
    • B) No additional platforms/infrastructure
    • C) Bi-lateral roaming traffic
    • D) No acquisition cost

To keep this short, I won’t even talk about great plans like Ooredoo Kuwait offering retail roaming plans that compare with domestic rates of visited countries, or even 3 UK’s Go Roam proposition, enterprise applications, waterbed effect, content lock, home short code access, 2FA, etc etc. … I’m sure you don’t have all day.

I write this at the same time, when most operators are announcing free roaming and/or calls to Turkey and Syria, so when I read posts claiming that MNOs aren’t doing enough, as a respected industry colleague put “makes one’s blood boil”.

So, while it makes quite a sensational story to say that operators aren’t cheap enough and it’s best to use a Roaming eSIM, the truth is that comparing the two is like comparing a Rolls-Royce to a Lada (if you haven’t heard of a Lada, there’s a good reason for it), or a Ritz-Carlton with a youth hostel.

I have the honour and privilege of working with and being inspired by some of the best people in our industry on a daily basis. These professionals tirelessly work day in and day out to provide the best possible service and customer experience, making the world smaller and more connected. For anyone who understands Roaming and the sheer benefits, security and value it brings, to suggest that a Roaming eSIM is really the way forward, is not only extremely shallow, insulting to perhaps one of the greatest services ever built*, but also dangerously recommending that customers should move to a severely degraded and restricted service in comparison.

For more on what Roaming has contributed please read my previous blog at: