The commercialization of SGP.32 is fast approaching and is set to mark a significant milestone for the eSIM IoT ecosystem. SGP.32 is the latest GSMA-backed standard and is expected to accelerate eSIM adoption in cellular IoT, offering greater flexibility, scalability, and efficiency. However, key ecosystem players must address early adoption challenges, particularly around awareness, integration, and coexistence with existing standards like SGP.02 and SGP.22.

To provide clarity on this transition, Counterpoint Research, in collaboration with Semtech, a leading IoT connectivity provider, presents a four-part video series as part of Counterpoint Conversations. This series aims to answer critical questions about SGP.32's impact, deployment strategies, and enterprise readiness.

In the first episode, Varun Gupta, Senior Analyst at Counterpoint, and Rupa Datta, Senior Director of Product Management at Semtech, discuss SGP.32’s origins, its role in the IoT landscape, and the key benefits enterprises can leverage for their deployments.

The Interview

Key Takeaways

1. Addressing the IoT Gap: While SGP.02 (M2M eSIM standard) supports basic machine-to-machine deployments and SGP.22 (consumer eSIM standard) caters to smartphones, smartwatches, and other consumer devices, the IoT ecosystem required a dedicated eSIM standard tailored to its unique challenges.

2. Architectural Advancements: SGP.32 builds on SGP.22, introducing key architectural elements such as eIM and IPA. These enhancements optimize profile management and remote provisioning, making eSIM deployments more efficient, especially for resource-constrained IoT devices, which form a significant part of the ecosystem.

3. Accelerating IoT eSIM Adoption: The eSIM adoption rate in IoT has been slower due to regulatory hurdles and limitations of existing standards. With SGP.32 overcoming these challenges, initial adoption is expected in sectors like utilities, energy, automotive, and asset tracking, where remote connectivity and lifecycle management are critical.

4. Commercial Availability and Industry Readiness: SGP.32 is set for commercial launch in 2025, with Semtech planning deployments by mid-2025. The new standard will streamline remote connectivity management, reduce operational costs, and enhance efficiency – key factors for driving large-scale adoption.

5. Easier Connectivity Switching – A Double-edged Sword: SGP.32 simplifies switching between connectivity service providers, offering enterprises greater flexibility. However, this shift demands higher-quality, high-performance, and ultra-reliable connectivity – crucial in mission-critical applications where uptime is paramount. Semtech, with its expertise in IoT connectivity solutions, is well-positioned to address these demands.

Analyst Take

1. Understanding the Standard is Crucial: With SGP.32 nearing commercialization, enterprises must fully grasp its technical nuances, benefits, and differences from existing standards like SGP.02 and SGP.22. A thorough internal assessment of business needs and deployment strategies will be essential for a smooth transition.

2. Driving eSIM Adoption in IoT: SGP.32 is set to accelerate eSIM adoption in the cellular IoT space, providing enterprises with a scalable, future-proof solution to simplify connectivity management, reduce operational complexity, and enhance digital transformation initiatives.

3. Adoption in Key Sectors: Industries such as connected cars, asset tracking, utilities, and smart retail are expected to lead the adoption of SGP.32-based eSIM deployments, leveraging its flexibility, improved lifecycle management, and cost efficiency as it becomes the industry standard.