UK operators stand to benefit from iPad Apple SIM, expert says

Apple SIM, the SIM-card that comes pre-installed in Apple's new tablets and will let owners switch between carriers at will, is currently only supported by one UK network, with some suggesting that the own-brand SIM is a big potential threat to the operator status quo. But an industry expert speaking to CNET suggests that Tim Cook and pals' new technology could be a win for operators.

Last night Apple took to the stage at its California headquarters to show off the iPad Air 2, iPad Mini 3 and a new iMac with a Retina display. What it didn't discuss however is an exciting new SIM-card that's nestled in the Wi-Fi plus 4G versions of its new tablets -- one that lets you choose from a variety of short-term plans from network operators, right from your iPad.

The advantage of such a scheme is that you're not tied into a lengthy contract with one particular operator, and can get data on your iPad as and when you need it, with the freedom to shop around and see which network has the deals that suit your needs. When you go on holiday abroad, you could choose a data plan from a local carrier, instead of paying your home network's pricey roaming fees.

In the UK however, EE is currently the only network offering its tariffs through Apple SIM. O2 and Three confirmed to CNET that they're not currently participating, while Vodafone declined to comment.

Update: Vodafone has offered the following statement. "Vodafone will be selling the iPad Air 2 with our own SIM cards and data plans. We are working with the wider industry and the GSMA to develop global standards for such interoperable SIMs and these are expected to be deployed in 2015."

A threat to networks, or an opportunity?

Operators have already seen their money-making schemes threatened by apps such as WhatsApp, which cuts into the number of SMS texts people need to send. But is Apple SIM is yet another danger to mobile operators?

Ben Wood, mobile analyst for CCS Insight thinks Apple SIM could in fact be a chance for operators to make more cash from tablets -- a category that, Wood says, doesn't currently generate much money for network operators.

"The attach rate on tablets [i.e, the number of extras that can be sold around tablets, such as network data plans] is shocking. It's so low. Networks have tried giving away SIMs, but people don't want to do it," Wood told CNET, noting also that because tablets typically don't bring in much revenue from data for networks, there's little incentive for operators to subsidise the cost of buying one, in the as they currently do with smartphones.

In other words, Apple SIM could make it easy for iPad owners to splash some cash on a network's data tariffs, where they otherwise would have shunned getting a SIM for their tablet entirely.

Wood suggests that only one UK operator currently supporting Apple SIM in the iPad suggests that UK networks "may have misunderstood what Apple was trying to do."

"You'll see a lot of network operators all of a sudden jump on this," Wood predicts, further suggesting that the Apple SIM is unlikely to make its way into smartphones any time soon.

"Operators will resist that indefinitely. That is an area where they won't be comfortable," Wood says. "The SIM will stay."

Apple does rely on network operators in a big way, as they subsidise the cost of buying its smartphones, making it cheaper for more people to buy them up front, leading to greater sales for Apple in general.

Wood noted however that Apple SIM does demonstrate Apple's power to alter the industry status quo. "No other manufacturer could have done this. It shows you the power Apple has in the market," Wood said.