Mandatory SIM Card Registration in China to Cause Turbulence in Global Shipments

ABI Research forecasts the rising global SIM card market to top five billion shipments this year, and expects developing markets in South Africa, Saudi Arabia, and pockets in the Asia Pacific and Middle East regions to experience above average growth rates through 2021. A mandatory registration, however, will cause turbulence in the Chinese market, as the government now mandates citizens to register their SIM cards.

“The Chinese SIM card market will experience an unsettling period from late 2016 up to early 2019,” says Dimitrios Pavlakis, Industry Analyst at ABI Research. “Somewhat slower growth for 4G and the subsequent cannibalization of 3G shipments will characterize this chapter.”

China’s current economic climate continues to affect most technology segments, causing shipment decline across multiple verticals and affecting SIM card sales noticeably. Governmental mandates are also pushing the three big MNOs to increase LTE penetration rates. While all citizens will be subjected to mandatory SIM Card registration by 2017, or otherwise will be under penalty of account termination.

“Not all is bleak, however, and while LTE rollouts are still facing difficulties in certain Asia Pacific regions, we foresee global 4G SIM card shipments accounting for approximately 23% of the overall APAC shipments for 2016,” concludes Pavlakis. “This percentage will rise to almost 45% by 2021 in the APAC region, sitting above the 43% global 4G shipments, as 4G becomes dominant.”

These findings are from ABI Research’s SIM Cards and SIM Card ICs market research. These reports are part of the company’s Digital Security sector, which includes research, data, and analyst insights.