SIM card production will be affected by chip shortage during 2022

The crisis in the production of semiconductors  will also affect mobile SIMs  this year, as well as other factors.


The technology industry is reeling from the shortage of semiconductors  and production problems will not only be limited to items such as components for computers or video game consoles, but also to the manufacture of an essential accessory for smartphones : the SIM .

As mentioned by global tech intelligence firm ABI Research , shipments of removable SIM cards are forecast to decline from 4.36 billion units in 2021 to 3.93 billion in 2022 . As the company highlights, this comes as a byproduct of the COVID-19 pandemic , which caused the chip shortage last year.

As Phil Sealy , Director of Telco Cybersecurity Research at ABI Research , explains, “ Pre-COVID SIM card shipment levels are not expected to be reached again in their removable format , due to other market challenges. such as the continuing decline in SIM replacement rates and the rapid growth of eSIM . ”

“The chip shortage should be viewed as a near-term market challenge, likely to improve in 2023 as more chip manufacturing capacity comes online and the market recovers briefly ,” Sealy said in the statement.

SIM cards face more than just the pandemic

As Sealy points out , the main threats in the SIM card market are not only the pandemic and the shortage of semiconductors, but also the saturation of the mobile phone market , which limits growth opportunities. “Average smartphone selling prices are at significantly higher levels than a few years ago, negatively affecting removable SIM churn rates as device contracts lengthen to spread the cost of higher-priced smartphones for a longer period of time , ” the executive said.

In addition, the imminent popularity of the eSIM has also reduced this market since, although there are a large number of these devices today, the use of devices with dual SIM , which combine the electronic version with the traditional removable one, has limited the impact of removable cards so far.

“Overall, ABI Research believes that the removable SIM market will only be marginally affected by eSIM over the next two years, due to continued issuance of dual SIM devices. However, with strong rumors circulating around the launch of an eSIM-only Apple device , a higher level of impact should be expected starting in 2023 and 2024 , ” Sealy said.

The origin of the report on SIM cards

The ABI Research report is part of the Telco Cybersecurity research service which includes data, research and ABI Insights. Market data spreadsheets are comprised of company-derived market share data and segmented, service-specific forecasts to provide a better segmented view of where the opportunities lie.