How are SIM cards made

SIM cards are a german invention with a rich history, and nowadays, a handful of international manufacturers control the vast majority of the SIM card market. However, the SIM card manufacturing landscape may be turned upside down in the advent of the eSIM. A SIM that is integrated into the device's circuit board during manufacturing. While legacy SIM cards manufactured in the early 90s used to be as bulky as a credit card and could only save 5 SMS, the modern eSIM is around half the size of a nano SIM can and can switch between carriers by simply scanning a QR code. Even though network providers may have a conflict of interest with the eSIM, Micro- and Nano-SIM cards are likely a thing of the past.

Who made the first SIM card?

The first SIM cards were developed by a German company that traditionally specializes in the development of smart cards and banknote security features. The first 300 SIM cards manufactured by the company were sold on to a Radiolinja, a Finnish wireless network provider. Radiolinja's network also hosted the world's very first GSM telephone call in 1991.
During their infancy, SIM cards looked very much similar to the credit cards we use today, as they are also SIM chip enabled. Back then, SIM cards could store data between 32 KB and 128 KB, which was also used to store SMS messages and phone contacts. These early SIM cards were only able to store around 20 contacts and 5 SMS messages.

Who is the biggest manufacturer of SIM cards?

Gemalto is the world's largest manufacturer of SIM cards. The company is based in the Netherlands but has factories around the world, including in the USA. According to "The Intercept", Gemalto produces around two billion SIM cards per year. But the company's products end up not only in mobile phones but also in bank cards, electronic passports, and ID cards around the world. Gemalto's customers include major telecommunications operators such as AT&T, T-Mobile, Verizon, Vodafone, as well as companies such as Visa, Mastercard, American Express, and Barclays. Even Audi and BMW use Gemalto chips in their vehicles. Chip cards (not just SIM cards) produced by Gemalto represent 49% of the global market.

What information is stored on a SIM card during manufacturing?

During production, crucial information is written into the memory of the SIM card: the IMSI number (International Mobile Subscriber Identity), depending on the network operator who ordered the card, and a 128-bit key called Ki (Key Identification). In simple terms, IMSI and Ki represent the mobile phone user's credentials (login name and password), which are permanently programmed into the SIM card chip.

 

The relationship between a customer's IMSI and telephone number is stored in a special, dedicated database called HLR (Home Location Register). This information is also copied to an additional database, VLR (Visitor Location Register), in each area of the network, using the customer's temporary "guest" registration with other carrier networks.

What are eSIMs, and how will they make traditionally manufactured SIM cards obsolete?

In contrast to the traditional SIM cards, used up to now, an eSIM (embedded subscriber identity module) is permanently installed in a device and cannot be changed. If you want to switch to another phone provider, the eSIM is reprogrammed. For this purpose, Apple iPhones, for example, simply scan in a QR code transmitted by the provider. Alternatively, you can also use the provider's app or enter the eSIM information manually:

eSIM advantages:

  • Easier and faster provider change, as you no longer have to wait for the new SIM card. The eSIM can be reprogrammed immediately after signing the contract.
  • No more problems with incompatible SIM card sizes. SIM cards no longer need to be punched.
  • No more potential damage caused during insertion or removal of SIM cards.

eSIM disadvantages:

  • Mobile operators are skeptical about the eSIM slowing down its widespread adoption.
  • Possibly less data protection and privacy as the SIM card, device, and your contact details are more closely linked. It also depends on whether user-related data is completely deleted by the provider when the eSIM is reprogrammed.
  • Under certain circumstances, each device (household appliances, car, bicycle) may receive an eSIM to connect to a smartphone or the Internet. It is unclear whether the eSIMs will actually be able to be completely deactivated. This brings us back to the issue of data protection.

Why the ever-increasing IoT landscape will drive eSIM manufacturing

While network providers are partially still hesitant to roll-out eSIMs to most of their clients (be it due to generic skepticism or an underlying conflict of interest), there is no doubt IoT network providers will recognize the eSIM as another connectivity milestone that will further elevate the feasibility of IoT-powered projects. Here are some of the reason why IoT network operators will prefer eSIMs:

 

Fast and flexible deployment of IoT devices

Having to deploy a new IoT project with hundreds or thousands of IoT devices in a foreign country that is divided up into different coverage zones would require a lot of manual labor with traditional legacy SIM cards. The eSIM completely removes this logistical nightmare and thus may severely reduce a project's time-to-market.

 

Switching carriers with ease

Changing network carrier can be a real hassle for both consumers and IoT projects alike. Users of eSIM can automatically switch to a different carrier in real-time, without having to order and install another SIM card. Thus it is also not necessary to be in the physical vicinity of an IoT-device that is potentially located in hard-to-reach environments.

 

More compact and convenient

IoT devices sometimes need to be as small as possible, and even manufacturers of networking devices intended for consumers are under constant pressure to reduce the bulkiness and weight of their products. Devices with eSIM technology do not require a tray for a SIM card, and the eSIM itself is around half the size (6x5x0.67mm) of a nano-SIM card (12.3x8.8x0.67mm). This cuts manufacturing costs and users end up with a more compact and convenient product. Especially for IoT-enabled devices in the healthcare sectors, such as IoT-enabled heart pacemakers or insulin pumps, this is a major advantage.

  • The first SIM card was made by a German security company in the 90s.
  • These legacy SIM cards could only store 20 contacts, 5 SMS, and between 32 KB and 128KB of data.
  • Nowadays, the Netherlands-based company, Gemalto, manufactures most SIM cards and is said to produce around 2 billion SIM cards per year.
  • Due to its major advantages, especially in global IoT use cases, the future of SIM card manufacturing lies in eSIMs.
  • The eSIM allows to change providers swiftly and automatically and allows device manufacturers to develop more compact and lighter IoT-enabled sensors and actuators.