Welcome to The Mobilise Podcast, your go-to source for all things telecom. We’re here to provide insightful analysis of emerging trends, innovations, and industry insights to help you easily navigate the digital era.
In our second episode, we will explore the various pitfalls and challenges that arise with eSIM offerings, focusing on the mistakes that operators have made while implementing eSIMs.
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Transcript
Hamish White: Hello everybody and welcome to the Mobilise podcast. My name’s Hamish White and I’m Founder and CEO of Mobilise. And I am here today with Per Kristofferson, our CCO and industry veteran in the telecoms industry and eSIM space.
Today, we wanted to talk about the pitfalls of eSIM offerings that we’ve seen. And in particular, talk about some of the, I guess, mistakes that we might call them that some operators have had implementing eSIM.
So maybe what we can do is just start quickly with a recap on what consumer eSIM is. Maybe Per, would you be happy to give a little bit of an intro on what consumerism eSIM is?
Per Kristofferson: Yeah. So, consumer eSIM. The digital version of the physical SIM card. The ability to download the eSIM to your handset. Consumer device, wearable. But mostly we’re talking about the mobile phones in this area, yeah.
HW: Yeah. And consumer as opposed to IoT eSIM, which has obviously been around for quite a long time and been much quicker in terms of adoption I think versus consumer eSIM. And to talk a little bit about that and maybe some of the challenges the consumer eSIM industry has had over the last, well. 10, 8 years ago was when the was when the consumer eSIM specification came out from GSMA.
But really for a few different reasons. Partly because some of the stakeholders in the industry maybe not been so on board with the concept of eSIM through some of the perceived risks – customer churn. But the adoption rate of consumer eSIM has been a little bit slower.
And although that’s changed a little bit in the last kind of 18 months or so with the likes of our friends, Apple, putting all of their marketing might between or behind eSIM and launching an iPhone, iPhone-only eSIM. Or eSIM-only iPhone last was it last September or September before?
PK: Something like that.
HW: So, the adoption and awareness of eSIM is really starting to grow, isn’t it?
PK: Yeah, so, I remember the first flagship handsets I had with the SIM card holder for two SIM cards. Which was fantastic because.
HW: dual-SIM
PK: Dual-SIM! Once there was 2 modules in the handset and it was two completely separate phone lines. That was really good, but then it quickly shifted away from that to you just having one physical SIM and then you would download an eSIM for your second one. But you would still have that physical one in there. And I still do in mine at least. But yeah, yeah, we’re well on our way to going fully eSIM I guess.
HW: Yeah, yeah. And it’s, you know, it’s, it’s interesting there’s been dual-SIM phones around for a long time, hasn’t there. But now with the advent of eSIM and the ability to have multiple eSIM profiles on one device gives the consumers a lot of flexibility to choose the subscription because it’s not just about the eSIM, it’s also the subscription that sits on top but gives them a lot more choice about which subscriptions to use at which point in time. So, you could have an eSIM for your local national service for example.
Or you could have an eSIM for an international traveller scenario if you’re travelling overseas and you want to get better rates. So, it gives that flexibility.
But I tell you what’s interesting is really the topic for today’s podcast is, you know, even though eSIM is supposed to improve the experience for a lot of consumers, some of the challenges that we’ve seen with eSIM implementations is actually that they haven’t improved their experience for end consumers.
And actually, have been implemented in ways that kind of work against the benefits of eSIM. Maybe if you got a couple of examples that you might be able to touch on in terms of some implementations of eSIM that maybe haven’t been able to maximise the benefits of digital SIM.
PK: Yeah. So, I don’t want to be too harsh. I mean, it’s been early days the last couple of years and of course, there’s learning to it. But some MNOs, for example, have seen it as a tool to play it defensively at least, so, they knew this was coming. They didn’t really want it coming for defensive reasons. So, they put something out there, but it wasn’t really a wholehearted effort to put something out there.
So, the onboarding journey, we can leave that for now. But if you want to offer something, you need to at least have a decent offer.
Data Bundles – Options & Pricing
PK: So, what you need to have is attractive data plans. You need to have an attractive offer that somebody actually wants to buy in order to utilise the ease and capabilities for travelling and so forth. For extra data, for having two subscriptions, one for your company, one for your private life and so forth.
And some of the bundles we’ve seen, especially in data roaming, have just not been attractive enough and that of course will destroy any service. If it’s not attractive enough, either the plan was too expensive or you were offering too much, you were offering more than what’s actually needed. So, the target subscriber base was tiny, quite simply.
So, in order to make it attractive, you of course need to target what is needed out there and some have missed the mark on that point.
HW: Yeah, it’s interesting. And again, not to name names, but we did have a situation or circumstance last week where we were comparing some pricing from a major MNO. Let’s just leave it at that. For a roaming proposition and very inflexible. I think it was based on a day package and effectively the amount that the customer received was quite ample. I think it was almost bordering, maybe it was unlimited without checking the terms and conditions, but certainly represented as unlimited. But the price point was quite high and just inflexible.
There was a, particularly the customer that we were talking to wanted something that was a little bit more flexible in terms of the types of plans that they could offer to their end users and be it smaller data allowances for a smaller price point. Perhaps that could have been even higher margin percentage-wise than you know than the All You Can Eat Unlimited plan. But just that, you know, more flexibility to cater to different user profiles.
PK: Yeah.
HW: Interesting.
PK: And again, the point of these is to use it as a tool for making the pie bigger.
HW: Yeah.
PK: And you need to have the right offer in order to make the pie bigger. Otherwise, your pie will remain the same size.
HW: That’s right, isn’t it? That’s right, Yeah. And that’s, you touched on a good point there. We’ve talked quite a lot about what’s the value for operators in deploying eSIM, but then also some of the business models that go along with eSIM.
So, a perceived threat that has been around in the industry for a while about eSIM facilitating an easier switching process for consumers and the threat of churn that that brings for operators.
But actually, some of these other business cases that are enabled by eSIM, such as Embedded Connectivity, like enabling travel companies, enabling fintechs with an add-on product, you know, we’ve talked about this that actually what we feel is gonna happen there is it’s gonna grow the pie for the operator.
So, it’s not that there’s necessarily going to be a substitution of revenue. It’s more gonna be that the pie is gonna get bigger and there’s more to go around for all.
PK: Yeah.
HW: So yeah.
PK: It’s the age-old fear of cannibalising yourself, which we see no indication of happening. We see growth with our customers.
HW: Absolutely, absolutely.
So 100% just to recap on that eSIM is, you know, it’s got a lot of benefits, amazing for user experience, opens up a lot of new business models, but it’s only part of the jigsaw puzzle. Obviously, the jigsaw puzzle has to be complete.
So, eSIM is great, but you also have to have competitive pricing that goes along with that. And I think also this enables more flexibility too, in terms of pricing, because you don’t have perhaps all of those logistics costs or upfront commissions that you have to pay to retail estates in order to be able to deliver a service to the customer. So those smaller type bundle packages, for example, can actually be quite profitable in the end.
PK: Yeah. And it’s also a, it’s an old disease in the MNO world that when something new comes along, it becomes a technology-focused offering. So, in the early days of eSIM, in the early days of whatever G you were selling, you, MNOs communicated to the market about the technology instead of the use cases and partially the same thing happened with eSIM.
It’s a buzzword and it’s a good buzzword this time around because something is actually changing. You’re losing the physical SIM and you’re downloading a digital SIM and everybody loves the news story in that alone.
But communicating eSIM as a technology is a big mistake. It’s about having the right offer of course, and the data bundles are important.
HW: And it’s about the value that it presents to the customer as well. And it’s a really nice segue into the next part of the podcast actually. In that the telco industry maybe has been a little bit guilty of over-promoting technologies as opposed to consumer benefits.
Consumer benefits may be from a pricing perspective every now and then. But when you look at perhaps the way that other industries that are great in terms of customer satisfaction and in terms of user experience, let’s say big tech for example, they really don’t talk very much about the technologies that underpin their platforms.
They talk about customer value, they talk about customer experience. There’s a really good quote from Jeff Bezos I remember seeing recently which was “they’re obsessive about the customer”.
PK: Yeah.
HW: Everything that they do is focused around the customer. Whereas in the telecoms industry, I think it has been very much about, well, how are we gonna market this 4th generation, how are we gonna market this third generation, very technology driven and network driven population coverage and 99% coverage. And so, yeah, you get that little bit of a disconnect.
PK: Yeah.
HW: But I think where we’ve maybe seen some other pitfalls which is related to that with eSIM, is just around the user onboarding and how the MNOs and MVNOs and telcos in general have been implementing the onboarding journey.
And I think from the reviews that we did, so we did a piece of analysis for anyone that is interested to see it’s up on the website. We reviewed a bunch of eSIM applications and there’s quite a few pitfalls that have come up in terms of the way that these eSIM solutions have been implemented from a user experience perspective.
And a couple of those just to mention, for example, an operator that we saw here in the UK. This was probably a while ago now, so it might be a bit unfair to them. They might have improved it by now.
Poor Customer Support
HW: But in order to get the eSIM you had to either call into customer care or go onto the website, request it via post, which took two days to get to you. It was on a piece of cardboard, which obviously isn’t great for the environment.
And then you’re able to provision it by scanning the QR code, which kind of is 180° backwards to the benefits of what eSIM delivers, you know?
PK: Yeah.
HW: So maybe you might be able to just talk a little bit about some of the pitfalls or challenges or problems that you’ve seen with eSIM implementations from operators.
PK: Yeah. So.
HW: From a user journey.
PK: Yeah. So, it is about the user journey and communicating technology is a big mistake. It’s a mistake that I’ve fallen into myself many times because I’m a techie and people in telecommunications in general are and that’s the problem, of course. We are tech-aware people who are trying to communicate something else and that we fail at that sometimes.
But it’s about the user journey and it’s about making it smooth. It’s about having an updated app with an updated user experience, that is following the user experience trends that you will see across apps that you will see as the OS of your device grows.
There’s different capabilities for app developers to utilise and to use into making a, how should we say? Modern or trendy user experience. And you need to follow that. Although you have an app that has a good user experience, it also needs to be an up-to-date user experience. And there’s a certain similarity between apps that are, is just expected. Like the design of a website needs to be matured because the usage and the way we perceive the user experience changes over time. And that’s just how it is.
So just implementing a new feature in your old app is most likely a mistake. You need to sometimes refresh the whole thing. That’s my experience at least.
User Onboarding
PK: So, an up-to-date app, eSIM and QR codes do not go hand in hand. It was a tool to get started. All good. But we’ve moved beyond QR codes, we’ve moved beyond activation codes. We need an easy smooth digital onboarding now.
HW: Absolutely, yeah. And I think the other thing that is quite interesting for today’s mobile user, is there’s not a lot of patience to deal with the poor user experience. And particularly the younger generation who are quite tech-savvy, you know, maybe one poor user experience they might overlook. But if you start to have two or three experiences that aren’t intuitive and maybe a little bit, got a bit of friction in them or a little bit clumsy, then you’ll find users will just, you know, drop the app, and say this is all too hard. Too complicated.
PK: Yeah.
HW: And that can actually then have a more detrimental impact than you’re trying to do something that’s positive and improve the user experience by providing eSIM. But actually, if it’s not implemented in the best way and meeting the customers’ expectations, you can actually end up having a negative experience.
PK: Yeah.
HW: And maybe just to touch on a couple of the things that we noticed in this research that we did. So sometimes there can be little things as well. So contradicting or incomplete instructions on how to install the eSIM application. Sorry, the eSIM itself, because obviously, there’s a couple of stages. You’ve got to go through the onboarding journey within the mobile application. But then once clicking the activate button you’ve gotta fall down into the iOS or the Android operating system instructions. And there’s a handful of steps in there which, if there isn’t the right type of education around those steps for the user, then sometimes that can get a bit confusing or a bit frustrating. So, making sure that there’s a good set of instructions, very clear, perhaps a video tutorial or something like that to help guide the customer through the journey and what they can expect.
One thing which did come out quite a lot in our research is not providing alternative signup processes. So, for example, being able to have social login like Facebook or Google. Like most of the applications today, you would expect to have that way to kind of sign up to a service or log into a service.
PK: Or at least a smooth KYC process.
HW: Yeah.
PK: That can be quite heavy in an app, and you need to be able to offer it as a smooth journey.
HW: Absolutely. And that actually is a really good point because in a lot of jurisdictions where KYC is a requirement to subscribe to a mobile service, you can’t really benefit from eSIM without having an electronic KYC process as well. Because the customer obviously can’t sign up for a subscription if they also can’t go through an electronic, sorry, sign up for a subscription online if they can’t go through an eKYC journey. So, 100% those two have to go hand in hand in order to be able to get the benefits of eSIM.
So, obviously some more straightforward ones like QR codes rather than in-app activation. We know about that one. Not without its challenges as well, particularly with the entitlements process with Apple. You know, we’ve seen that that can be a bit of a barrier to providing the in-app provisioning in that Apple can be sometimes quite restrictive about who they’re offering and providing that entitlement to.
PK: Should we add that this may be going away soon?
HW: Yeah, Yeah, sure. Yeah. I can’t remember what the actual, what was the actual term that they had for it.
PK: I think it was OS 17.4.
HW: Yeah, that was the latest version.
PK: Yeah. That would enable you to do eSIM installation without entitlement.
HW: Yes, without entitlement. And I think the way that they’ve got around this, because this was a big bone of contention in the industry, I think, particularly the MVNO industry, where it’s harder to be able to adhere to Apple’s criteria for getting that entitlement.
But the way that they got around it I think is, is that effectively, which is quite smart, I think. But effectively the QR code is sent into the phone photos. So, it’s actually the QR code is in the photos, and they’ll be able to pull up, yeah, it’s a screenshot that is in the photos and then by pulling up that QR code you’re able to select, effectively allow the camera to select the QR code and it kicks off the activation process from there.
So yeah, I saw a video this morning actually it’s quite interesting and a smart way to get around it. But definitely what that’ll do is it’ll open up the possibilities for service providers, being telco or non-telco, to be able to gain the better user experience of the in-app provisioning, so.
PK: Yeah, and that opens up the market to provide eSIM services. And if we’re talking about consumer roaming travel services, then getting back to what we said before, it’s about if you have an offer then it’s also about providing the best user experience because there’ll most likely be many offers out there. And if you have an app with a solid user experience, if you have the right product and pricing, then it falls down to your app usability and user experience. They will choose the best one like any app you use.
If you’re fine looking for an app to provide you some kind of functionality, you’ll use the one with the best user interface. Yeah, there’s 3-4 apps of all sorts that will provide you your flight data, your map or whatever, but you choose the one that you prefer the interface of.
HW: Absolutely.
PK: And it’ll be the same for eSIM. You need to have a good journey and customer-centric.
App UI & UX
HW: Yeah, there’s a really good term or phrase that’s used in UX design which is having frictionless experiences. And it’s you know, the few things that we’ve mentioned there before like not having the social login or perhaps you know the instructions for how to use eSIM being a little bit confusing. Perhaps the UI or UX is not as sleek as you might want it to be.
Those things in isolation by themselves are probably fine, but when you combine them all together that’s when you start to have dropout from the users. And that’s where I think you start to have a bit of a negative impact on the user experiences.
Actually an interesting statistic that we put together from this research, which I think is interesting in the context of the importance of UI and good UI and UX. And it’s an average.
An average person uses 9 mobile apps per day and 30 apps per month. However, 71% of app users churn within the first 90 days of downloading an application.
That for me is really insightful. It goes to show how important it is that the experience is just seamless, smooth, frictionless. But also it shows the patience that users have for applications. You know if it’s not hitting the mark and the first time that they touch it or there’s any sign of kind of inefficiencies or friction in the experience, then you’re out.
So, it’s important that it’s that the user experience design is top notch. And we talked about this a little bit before in a previous podcast. But you know, ties in a little bit to the way that I think the telco industry has viewed customers in that it’s been very much about developing products and marketing those to the customers. As opposed to really reversing that which some other entries do like big tech. And really putting the customer needs right at the forefront and developing your products and services around those customers. And I think from a digital perspective and user design perspective in particular, the telco industry is a little bit maybe underserved in that realm.
And I always use a great comparison, for me anyway, is that you look at the experience that you get from, say, Facebook or Spotify or Netflix, and that’s a really slick, intuitive user experience. But conversely, you have a look at your mobile application from your provider and it doesn’t usually feel on par with, you know, those other types of applications.
And it doesn’t take much, it doesn’t take much for customers to get frustrated, you know?
PK: As a comment to what you mentioned earlier about Amazon. People will buy. The product will be less important compared to the user experience. If you’re buying a certain type of product, people will go to their favourite user experience website to buy their products. So, when Amazon has absolutely everything on there and they have the best user experience, people will go on there to buy their product.
And that goes for most things. And if you are a product provider, you will lose your customer and you will become a product provider to somebody else’s marketplace who will own the customer and who own the customer experience.
So, it’s with that mentality you need to look at your user experience. You really need to own your customer. And keep them within your realm in order to make it sustainable to be able to.
HW: Exactly absolutely. Yeah, I mean it’s really interesting.
And one of the things that hopefully we like to do well at Mobilise is we bridge that gap between kind of the telco knowledge and understanding about user experience design and perhaps not generalising to all telco providers. But one of the areas that we’ve noticed anyway where the telco industry is a little bit underserved is on that user experience design and understanding best practices.
And hopefully, that’s where we like to think that we can help our customers is sitting between the telco world and the digital world because it is a very unique set of skills to be able to design a really nice user experience.
But then at the same time understanding the telco world like you know, what does it mean if a customer wants to purchase a 10 GB plan, what’s the unit economics behind that? What type of commission can they offer to their customers? And so, it’s, and, obviously also the technologies, there’s a million and one different acronyms in the telco world. So, if you want to be working with telco companies, you need to understand the jargon and the lingo.
So that’s where we really like to feel or believe that we’ve got a good position in the market is that we’ve been developing kind of digital experiences, be that app web and the infrastructure that goes behind that for many years now. So, being able to bridge the two domains I guess is important in terms of delivering something successfully for our customers.
PK: Yeah.
HW: Very good. Well, I think we’ve talked, we’ve talked a good a good amount about some of the pitfalls. I think maybe what we can do is just summarise a little bit some of the, I guess pitfalls or challenges or issues that we’ve seen that have frustrated, certainly me anyway, the most.
And I think for me the one that frustrates me the most and I saw it again just recently is when an operator implements eSIM on top of a physical SIM business process.
So, the example that I used before where you effectively either have to call into a customer support line to order an eSIM that comes in the post, or you got to go down to a retail store to pick it up. All of that kind of goes 100% against the benefits of eSIM.
But in saying that, to be fair to the operators, some of these implementations of eSIM are done quickly because there’s a need to get into the market with something quickly, but are also on top of legacy systems that have been in place for 10,20, sometimes 25,30 years.
PK: Yeah.
HW: So, it’s not easy. It’s not easy. How about you? Anything in particular that you’ve seen that frustrates you with eSIM implementations?
Self-care Element
PK: No. Well, you need to get it all right in order to be ahead of the pack, but setting expectations, knowing what to communicate in order to provide the right user experience. So, if you do go abroad, if you do travel, make sure there’s information available. Where does this data package work? We will inform you when you’ve used 80%, we’ll do a pop-up. We’ll give you the opportunity to top up. If you need more data, we’ll give you the opportunity to not top up and say I’ll stick to my budget.
So, to cater for the needs and to prepare the user for what kind of experience is this. That’s important because when you set expectations, people tend to not be as disappointed as without. But it’s a big part of it. And finding the right way to communicate those details to a consumer is important.
HW: Yeah, I think that’s a really good point, isn’t it? It’s really important to make sure that you set the expectation and also put the tools around the eSIM in order to make sure that the process is as frictionless as possible. So, some of the things that we’ve done in the past for some of our customers is video recordings for how the eSIM process onboarding process will work and you place those at certain points in the onboarding journey.
Whether it be after purchase, you make sure that you’re presenting the video of how the user will have to go through the onboarding journey or you put it right at the start.
Other things that we’ve looked at as well, which is a real, seems like a very simple thing, but actually it’s something that a lot of operators or telcos overlook is within the application, ensuring that there is a check to see whether the device is actually eSIM capable before starting them through the onboarding journey. And for a handful of the different implementations that we’ve done, we’ve placed that either right at the very start of the onboarding journey.
So as soon as the customer opens the application there’s a pop-up there that says please make sure that your device is eSIM capable. At other times we’ve had further down the journey where you know it’ll do a similar type pop-up, but give them an option to go down a physical SIM onboarding journey if they want to.
So, a little bit more interactive and guiding the user down a certain path. So yeah, to your point, I think it’s about making sure that you set expectations right and even if that might be a negative story is in that your device is not eSIM capable. So please, you know.
Signal & Coverage Quality
PK: In the same go, you could say that setting expectations, if you’re travelling to this country then setting the expectations of what kind of network performance can I expect here. So, saying in this country we will have roaming with three providers, one will be 5G, one will only be 4G. So, depending on which network you may experience speeds that are lower. It could also be a country with less rural coverage that could be remarked to the consumer before.
So, we set the expectations that because not all areas, not all geographies are easy to cover. So, depending on what your home country is and what you’re used to in terms of experience, you could set some network experiences and sorry, network expectations before sending your customer somewhere.
HW: I think that’s absolutely right and we’re at a really interesting time in the telecoms industry. My personal belief with eSIM is really set to change the industry and the way that the telco model is deployed.
There’s a lot of talk about how certain parts of the telecoms industry in certain parts in Europe, let’s say certain countries in Europe, are struggling.
You know here in the UK for example, you have the 3rd and 4th operator in the UK kind of really struggling to maintain margins and going through that merger process at the moment. And I think as small as eSIM might seem, it really does as a technology, it really does enable a new way to deliver the telecoms model.
And I think for that reason, we’re really interesting inflexion point in the industry. And we’ll be watching with interest to see how it all unfolds.
PK: Yeah, there’s a whole cost reduction side to it for the MNOs as well that they need to be aware of. It’s not just about being on the forefront of technology, it’s certainly also managing your cost base. And eSIM is a tool in that box as well.
HW: Absolutely, removing all those distribution, commissions, logistics, production of SIMs, all that kind of stuff, absolutely. It’s a cost-reduction exercise for sure.
PK: Yeah.
HW: Very good. Well, I think that covers the main things that we wanted to talk about today. So, I’ll say, thank you very much for joining us on this podcast today, Per and thanks everyone for tuning in.
