Holland says yes to the network-agnostic SIM card

Regulators in Netherlands this week opened the door for any company — whether Apple, Audi or your local electric utility — to issue its own SIM cards configured to no particular carrier. This is just one country changing its rules, but if other countries follow suit, it could have big implications for the internet of things and even change the way we buy mobile service.

A few years ago in a Gigaom post, European economist and policy analyst Rudolf van der Berg explained how such a setup could work for Apple(s aap) if it chose to shed the carrier yoke and sell connectivity directly to its iPhone customers. Basically Apple would provide SIM cards to all of its customers, and then remotely assign them different carrier networks as customers activated their service.

SIM cards galore

Source: Flickr / mroach

Apple could buy data and voice services in bulk from hundreds of different carriers around the world and then pick which network would be most appropriate for each of its customers at any given time. So if an iPhone user left his home country for a vacation in France, for instance, he wouldn’t get charged the usual high roaming rates. Instead Apple would just reassign his SIM card to one of the French networks. Instead of being a guest roaming onto a French carrier’s networks, he’d be at “home” anywhere in the world.

Whether an Apple or a Samsung has any interest in becoming a carrier to its customers remains to be seen — back in 2010, Gigaom reported that Apple was working on such a soft-SIM, though nothing seemed to come of it — but it could be of enormous use in the machine-to-machine (M2M) communications world, van der Berg told me in an email exchange this week.

Take a car company like GM, which is putting LTE connectivity into all of its cars. In the U.S., GM is locked down to a single operator. It doesn’t matter if you buy your smartphone plan from Verizon(s vz) or T-Mobile(s tmus); if you want to connect your Chevy to an LTE network, you have one choice: AT&T(s t).

With a carrier agnostic-SIM, a carmaker could attach your car to whatever carrier to you happen to have relationship with and change your connection whenever you switched carriers. Or it could run a managed service with multiple carriers, connecting to whomever’s network had the best capacity or coverage wherever you happened to be driving, said van der Berg, who is now with the Organisation for Economic Co-operation and Development (OECD).

Source: Gigaom

Source: Gigaom

While some carriers might be opposed to that concept, the mobile industry overall would benefit, van Berg said. In the internet of things, there is a lot of resistance to connecting gadgets and appliances to the cellular network because doing so would require device makers to lock into a carrier. But a programmable SIM card would alleviate that burden, making cellular connectivity much more attractive, van der Berg said.

Of course, we’re still a long way from this kind of carrier-agnostic networking become a reality. The Netherlands has eased its rules, and the GSM Association is behind the concept, but the network-less SIM is still illegal in almost every country in the world, van der Berg said.

And even with legal barriers lifted in Holland, there are technical limitations that need to be overcome, van Berg said. Still, getting Dutch regulators on board was a big victory, setting an example that van der Berg hopes other governments will follow.

Correction: This post previously stated that a network-agnostic SIM is also legal in the U.S. and Germany. That’s the not the case. It is allowed only in the Netherlands.