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Mobile network operatoron-demand subscription management study
2 Mobile network operator on-demand subscription management study
Executive In December 2013, GSMA, the global mobile phone operators’ association,
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Context, objectives and methodology
Our survey
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Subscription managerfor data preparation
MNO
eUICC
• Is functionally identical to a traditional SIM • Will have a “provisioning pro le” assigned at manufacture with
secret keys that allows the associated subscription manager to download and manage “operational pro les” on the eUICC
• The technical speci cation can accommodate both an initial declaration of the mobile operator in the eUICC, as well as the selection of a new mobile operator later
• Uses subscription manager to manage pro les • Reuses existing provisioning interfaces and processes
• Securely packages pro les to be provisioned on the eUICC • Manages the installation of these pro les onto the eUICC
• Ensures the secure transport of both eUICC platform and eUICC pro le management commands in order to load, enable, disable and delete pro les on the eUICC
Subscription managerfor secure routing
How it works: embedded SIM basic system architecture
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Survey objective: to understand how mobile operators perceive this initiative and whether it can
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Use case details
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Initial device provisioning
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• SIM cards
Use case 1:
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in M2M tenders
• SIM cards
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PoS
Customer
Customer
The car is soldto the customer withlocal connectivity
Local mobile operatordelivers connectivityto the connected car
Local distributor askslocal mobile operator to provision SIMs
Carmaker builds cars and shipsthem to various local cardistributors
Local MNO
Local MNO
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Use case 2:
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Use case 3:
Device maker
SIM and device manufacturerssell non-provisioned SIMs anddevices to MNO
MNO ships phones with non-provisioned SIMs to local stores
Customer selects tariff plan andMNO salesperson provisionsSIM with relevant pro le
MNO store
HLR
Provisions within theHLR licennse
Provisionscustomer’sSIM with aprepaid offer
Prepaid
Capped
Post-paid
Salesperson
MNO
SIM maker
Customer
Carmaker negotiates connectivitycontract with MNO A and sells aconnected car to the end user
Customeruses car withconnectivityfrom MNO A
Carmaker can switch connectivityover the years in response toregulatory constraints or change inecosystems
Carmaker
MNO A
Customer
MNO BMNO A
Connectivity MNO A
Connectivity MNO
Connectivity MNO B
Carmaker
x
x
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Use case 4:
SIM and device manufacturerssell non-provisioned SIM andportable gaming device to the MNO
MNO ships portablegaming device with non-provisioned SIM to local stores and additionalretailers
Customerbuys portable gaming deviceequippedwith SIM
When needed,activates SIMon chosen offer
Welcome to MNO XPlease slelect yourtariff plan: 10 MB 1 GB 10 GB
Additionalretailer
New distributionchannel
Device maker
SIM maker
MNO MNO store
Customer
Customer
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Use case 5:
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MNO MNO
User subscribes to anoffer within the portfolioof local MNO
User travels toanother country inthe EU with his phone
If selected, localnetwork deliversconnectivity to user
User can chooseto switch on local network
Do you wantto switch tolocal network?
Yes No
Customer
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Mobile operators’ technology strategies are likely to
M2M
M2U
Connecteddevicesmarket
Low bandwidth
High bandwidth
Morebusiness
Core business
Mobilityusage
Homeusage
Highbandwidth
SIM not easilyaccessible
Telematics
Infotainment
Tablets
Connected TV,photo frame
Ebook reader
Health care,cameras
Connected watches
Smartphones
Low applicability High applicability
Lowbandwidth
SIM easilyaccessible
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Mobile operators disagree on the most appropriate operating
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normal to use reprogrammable SIMs, some operational
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0b 1b 2b 3b 4b 5b 6b 7b 8bn
ARPU
(€/m
onth
per
con
nect
ion)
Volume (billions of connections)
2014
2020
2020
€500b-€550b 2014
2014 €750b-€800b
€160b-€190b
€0b
€0b-€50b €5b-€10b
Consumer electronicsSmartphones/tablet/PC M2M
2020
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revenue development opportunities, scope cutting costs
and the need to
In addressing revenue development,
cost reduction,
Devicemanufacturer
(e.g., carmaker) End user Lead MNO
Local MNO(partner)
Local MNO(partner)
• Customer relationship• Contractual terms• Billing• Service level agreements • Bootstrap connectivity
Local connectivityMain relationship Internal/intercompany ows
• Local connectivity
• Local connectivity
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In regulatory compliance,
Revenues Costs Value chain Legal
Categories of impacts Source: mobile operators interviews
Convergent feedback
Perceivedthreats for
mobileoperators
Perceived for
mobileoperators
Divergent feedback
Enabler ofM2M marketdevelopment
eUICC increases mobile data penetration by connecting
consumer electronics
eUICC supports “shared data bucket” marketing
strategy
Loss of customer“ownership”
Supportsembedded SIMliability-induce
costs
Need to massivelyupgrade IT and
businessprocesses
Increases churnon core business(smartphones)
Facilitatesreal-time network
arbitrage
eUICC raisessigni cant
security threatsfor MNOs
Increase inSIM total costof ownership
(TCO)
Lower expectedrevenues on tablet
connectivity
Reduces SIMlogistic costs SM-SR owner can
be any player in the ecosystem
MNO should be the SM-DP owner
Closed ecosystems(consortiums) are the best
go-to-market strategyfor MNOs
Comply with regulation as alternative to permanent
roaming
A lead MNO should be positioned as a
bootstrap
Overall returnon investment(ROI) of eUICC
Use cases 1 and 2
Use case 4
Use case 5
Use case 3
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Appendix: glossary
integrated circuit cards
data preparation
secure routing
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About EY
How EY’s Global Telecommunications Center can help your business
GA 1001853
EYContactsPrashant Singhal
Holger Forst
Amit Sachdeva
Etienne Costes
Bruno Perrin
Thibaud ChabreliéSenior Manager
Louisa Melbouci
Guillaume DjourabtchiManager