Following Onomondo’s launch of its own SGP.32 eSIM IoT Remote Manager, IoT Business News spoke with Michael Karlsen, co-founder of Onomondo, about what the new standard could mean for cellular IoT connectivity, vendor flexibility and the way enterprises manage connected devices over the long term.
Why do you think SGP.32 is arriving at an important moment for the cellular IoT market? What has changed in recent years to make greater connectivity flexibility more necessary?
Michael Karlsen: Ultimately, also, the Internet of Things has reached a point of maturity on a lot of fronts, but it still lacks a critical maturity marker: flexibility and interoperability. The connectivity industry has a history, DNA, and culture that locks in its users and clamor for ownership of customers far beyond the actual value it provides.
In this context, SGP.32, with its promise of flexibility and interoperable architecture, is important for two reasons: firstly, it addresses the parts of the telecom status quo that are not serving its customers. Secondly, it is a strong signal that the industry is reaching the next level of maturity.
I think that’s immensely valuable. It’s a critical tipping point and IoT is standing right at the crest. Important technologies like AI, the availability of network technologies and analytics tools for large datasets, and robot technology proliferation are a tailwind not just for what IoT can do but how it does it too. Freedom to operate is imperative if scale is to happen.
Many IoT companies have traditionally selected a connectivity provider early in the product lifecycle and stayed with that provider for years. Do you expect SGP.32 to change that model?
First and foremost, I expect SGP.32 to change how businesses invest and scale with IoT. Here’s why: The ability to change providers mid-lifecycle removes a significant risk layer in scaling the exact same product. Since network uncertainty and market uncertainty are no longer detrimental risk factors, eSIM IoT brings forth an insurance model that makes any IoT venture –across verticals and markets– more secure. This insurance model unlocks more investments in IoT and bolder scaling of existing projects, and that benefits everyone in IoT greatly.
From the operational side of things, the pre-SGP.32 model of selecting a connectivity provider in the design phase and sticking with them for the lifetime of the device was less of a choice on the part of fleet managers and more of a burden. Based on countless conversations, I know that IoT fleet managers have longed for that paradigm shift for years – long before SGP.32.
So, in short, yes, I expect SGP.32 to change the model of investing in IoT as well as the everyday work of IoT fleet managers, who will leverage the opportunity that the SGP.32 technical specification legitimized – to change connectivity providers whenever their needs change, without workarounds or field visits.
With this new eIM, which types of IoT deployments or customer profiles do you expect to benefit first from the additional flexibility offered by SGP.32?
Primarily, the segment I see benefiting the most from eSIM IoT is global deployments that include markets with permanent roaming restrictions, like Brazil, Turkey, China, Saudi Arabia, etc. This particular segment had a previously unaddressed woe in the design phase: the company would need to design different SKUs for these markets, ergo negotiate additional connectivity deals, and, post-deployment, manage these deals and keep track of usage and spending. With SGP.32, this can be a single design, a single SKU, a single deployment – just deployed in different geographies. And this is the primary case – the pragmatic one.
Aside from the permanently roaming-restricted areas, the clear winners are deployments with long lifetimes – from long-term global tracking solutions or industrial monitoring, to smart meters, smart grid tech, and even parking sensors. Before SGP.32, fleets of devices with five, seven, or ten years in the field posed the highest uncertainty risk because their owner had to make a choice that would lock them in for the longest possible time. The longer the lifetime, the longer the projection, and the more likely one is to get it wrong.
Of course, the biggest benefit is for the two use cases above combined.
Does greater freedom to switch providers also increase complexity for enterprises? How should companies balance greater control with the need to keep connectivity management simple?
This is a very relevant question. SGP.32 is not a panacea for every connectivity issue out there, and it bears repeating from our end too: SGP.32 comes with additional complexity and begs for a thorough risk-benefit analysis before making a decision.
As with anything, more is not necessarily better. SGP.32 solves certain central lock-in problems, but if a business doesn’t experience them as problems, which is often the case with short-lived devices or local deployments, then eSIM IoT adds complexity for very limited gain.
But for the ones who need the flexibility SGP.32 provides, it is critical to simplify how the eSIM IoT ecosystem is embedded into their business. That is another reason why Onomondo launched an eSIM IoT Remote Manager – because we believe in a) offering the most flexible solution possible, and b) that any IoT connectivity solution should remove as much friction as possible, especially in implementation and management.
I truly believe that any fleet manager that has considered this invaluable question deserves a head-on answer, for which I would point you to these two consulting documents the team has created to answer:
Could SGP.32 put pressure on traditional global IoT connectivity offerings based on a single provider and a single commercial relationship?
Absolutely, and it should.
An industry that is propped up on contractual limitations on vendor movement has no incentive to put its best foot forward every day. Consequently, from a macro perspective, it doesn’t add value to the industry it’s meant to serve.
That’s a core reason why I believe that SGP.32 will put pressure on providers that need it, in order to help scale the industry and work tirelessly to improve it. This will mean increased movement in the years to come, but all in all, that movement will reward innovators and incentivize everybody to do their best for the people we serve.
Beyond avoiding vendor lock-in, what do you see as the biggest business benefits enterprises could gain from SGP.32 over the lifetime of an IoT deployment?
The value of an intact ability to choose is the same value an insurance provides. It insures you against unkept promises, uncertainty, and unforeseen circumstances; against political or regulatory changes; and against missing opportunities just because you can’t predict them.
Having that choice requires flexibility after the initial technical decision. For solutions with a long future ahead of them, the value of such insurance is a massive business benefit.
If we look three to five years ahead, what do you expect the cellular IoT connectivity market to look like once SGP.32 is more widely adopted?
I believe that the flexibility introduced with SGP.32 will help connectivity in its most essential form –moving data from A to B– become a point of zero friction in building IoT.
I also hope that it will shift the focus towards connectivity benefits that add value to each solution. This shift will spur innovation across the industry: more players will pioneer connectivity services in security, smooth and coherent SIM provisioning, and incremental services that go above and beyond just connecting a device.
With everything coming at us –physical AI, quantum challenges, hyper power-efficient use cases, and massive scale for global fleets– a customer base with flexibility in their arsenal will be able to reward innovators for solving the future challenges. I sincerely think that bodes very well for the industry at large.
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