Providers don’t usually offer SIM cards free of charge. That is unsurprising—we analyzed the way SIM cards are made, how much SIMs cost, and the concept of blank SIM cards. To put a long story short, manufacturing IC (integrated circuit) chips is not complimentary. Manufacturers must mass-produce them and find a seller, e.g., a mobile network provider, and still turn a profit. Mobile network operators need to disperse these SIM cards to customers for use in prepaid, postpaid, or pay-as-you-go plans, as well as in various SIM card sizes, and still recoup costs. Why, then, do some choose to give them away? In other words, “Why are some SIM cards free?”
1. SIM cards are free because a mobile network provider charges for a user plan
Though lots of mobile network operators charge a nominal fee to cover the cost of the SIM card purchase, others decide to write that cost off. This is the most common scenario nowadays. That’s because they don’t mind losing a bit of money to offer users a small taste of what they offer. This is a well-known concept of a free trial present across a wide variety of industries, and, in this case, focused on a product. Here are some examples of mobile carriers providing free SIM cards to get users to become customers:
1. Selling top-ups, data plans, or paid prepaid activation
Providers of prepaid SIM and pay-as-you-go SIM cards are renowned for offering free SIMs to anyone that would sign up, solo or as part of a family plan. They often also offer free delivery to the customers’ address, seemingly with no strings attached. The catch is in the way users have to activate a SIM card usually by topping up their balance and setting it to expire in, say, a month.
Others demand that users utilize that balance to pick a payment plan or a bundle, send credit to a different prepaid mobile number, or call IVR (Interactive Voice Response). This lets them recoup the cost of the sold SIM card while preventing users from holding on to it forever. These profits also ensure that the cost of never-activated SIMs can be deducted from the profit.
2. Making users sign up for a postpaid plan
The concept stays the same with users of postpaid SIM cards that get one gratis. Only this time, it comes down to time, commitment, and loyalty. When a provider gets users to agree to a yearly or two-year contract paid monthly, with a likelihood they’ll upgrade, exceed the allowance, or use bundles, the cost of a SIM card is negligible in the long term.
2. Carriers supply SIMs to win market presence or catch up with the competition
Another frequent situation is when a carrier needs to fight for presence in a local or international market. To appease customers and offer something distinguishing, they may start handing out free SIMs every chance they get. This is the same tactic as the one above, except that carriers may be willing to be barely profitable or even lose money, making them offer unbelievably low payment plans. They will continue to do so until the concept becomes unfeasible, or they reach their market percentage presence goals.
3. Providers give free SIM cards to implement or promote a SIM-based technology
This should come as no surprise—at one point 2G, 3G, 4G, and now 5G were new technologies. What better way to convince customers to adjust and make a permanent switch than let them give a new technology a try through a complimentary SIM card? To illustrate our point, here are several representatives:
1. Digital SIM-related technologies
A noteworthy example that should be familiar to most people nowadays is the embedded SIM card. The IC chip is soldered to the motherboard of the device, and the carriers merely have to make the SIM profile in a digital form available for download. That only brings server hosts for the storage of profiles and updates pushed OTA (over-the-air). Therefore, it makes sense that carriers ramped up their offers of free eSIMs, as they can get the financial benefits without manufacturing a SIM card or organizing delivery to address.
Next in line are two SIM types still in development and awaiting global application, if one ever occurs:
1. Virtual SIM card technology
Virtual SIMs are, at the time of publication, nearly identical to the embedded ones. However, they will soon become capable of utilizing a mobile app to generate a SIM card phone number via the cloud. Since carriers won’t need to do the aforementioned costly things, they can offer free disposable SIM profiles and make money through the generation of each number and consequent mobile network use.
2. vSIM type
The second representative is vSIM, also known as the blockchain-based virtual SIM card. That permits carriers to reap all the benefits of eSIM and virtual SIM, but also be entirely hands-off once they establish the blockchain—only rake in the profits. Further, users can even make money from their free SIM cards by generating and selling SIM profile certificates.
2. Physical technologies based on a SIM card
Network providers, especially those that own equipment, are looking for industries to expand into. Besides regularly offering smartphones, tablets, and smartwatches, two noted examples include:
- Hotspot routers, i.e., portable routers powered by a SIM card
- A wide variety of IoT (Internet of Things) devices, such as sensors or smart home gadgets
In all cases, the price of including free SIM cards in the sale of costly products is negligible. Carriers and retail brands frequently partner and sell customers the convenience of having things ready to go.
4. SIM cards can collect data and help monitor, even scam users
If you read our study of things someone can do with your SIM card, you know not everything benefits the user. Many carriers make up the price of dispersing SIM cards by analyzing the data they collect about users and selling them for marketing purposes to third-party partners. Countries with a high crime rate also offer a free SIM card, though with heavy restrictions, hoping to monitor and control the number of criminal activities. With that in mind, there’s no doubt shady companies or individuals offer gratis SIM cards to gather personal information. Some even impersonate or create pricey bills in users’ names.