The US Department of Justice is investigating AT&T and Verizon for allegedly colluding with the GSMA to influence eSIM standards so as not to threaten their dominance over the US consumer market. The investigation was opened five months ago after Apple and an unnamed wireless carrier complained to the DOJ, according to Reuters.
eSIM, short for embedded SIM, is a new format of the ubiquitous SIM cards that are used in phones and other mobile devices to securely identify and authenticate a user on a carrier’s network. eSIMs are non-removable chips that are embedded into a device and allow consumers to switch networks through software settings instead of having to physically remove and insert a small piece of plastic into their device. Despite eSIM’s obvious advantages, it has yet to achieve any significant presence in the market, with only a few notable devices having adopted it so far, such as Google’s Pixel 2 and the Apple Watch 3.
SIM cards, which were once as large as full-sized credit cards when they were introduced in 1991, have gradually decreased in size as phones have become increasingly smaller, but are nonetheless an anachronistic technology in a time when manufacturers “courageously” remove the beloved headphone jack to save fractions of a millimeter in a device’s thickness. The ‘modern’ nano-SIM card, which takes up at least as much space, is a chip that can hold up to 256 kilobytes of data.
Aside from being much smaller than current nano-SIM cards, eSIM would let customers switch from one carrier to another with almost as much ease as one switches from one email address to another. According to GSMA, the eSIM standard developed in conjunction with AT&T and Verizon throws a wrench into these plans by allowing carriers keep an eSIM-equipped device locked to their network. Carriers would require permission from a consumer to lock their device, the GSMA said. The standard has now been put on hold pending the DOJ’s investigation.
A Verizon spokesperson called the investigation “much ado about nothing,” brushing off the matter as little more than a “difference of opinion” regarding eSIM standards. Verizon had previously stated that it needed to be able lock down phones as a way to prevent fraud and theft. While the justification appears laudable on the surface, it’s already possible for consumers to lock down their Android or Apple device in case of theft, and it’s not hard to see how the ability could be misused by carriers.
As it is, carriers around the world and in the United States in particular already hold an overwhelming power over consumers, often charging ridiculously high fees to purchase and activate a new SIM card. In the US, Verizon and AT&T control 70% of all wireless subscriptions. Making it easier for consumers to switch carriers would unquestionably threaten their grasp on the market.