According to TechCrunch, global eSIM adoption was only 3% last year and will just cross 5% this year, despite the tech being a decade old. In 2024, only 23% of smartphones had eSIM capabilities, with the U.S. leading at 41%. The travel use case is massive, with 51% of eSIM users activating it for trips, fueling startups like Airalo, which became a unicorn after a $220 million round in July, and Holafly, which reported $200 million in revenue for 2024 alone. Apple’s push with eSIM-only iPhones and a pivotal shift in China, where telecoms just began offering support, are key drivers. Analysts note a 30% activation rate on capable devices in 2024, projected to hit 75% by 2030.
The travel engine
Here’s the thing: nobody really *needs* an eSIM until they’re standing in an airport abroad, realizing their domestic plan costs a fortune. That moment of pain is the entire business model for a bunch of now-thriving startups. They’ve turned a niche tech feature into a travel essential. And the numbers are staggering—Holafly boasting $200M in a single year, Airalo’s monster funding round, NordVPN’s Saily app hitting a seven-digit user base in months. It’s a classic case of solving a specific, acute problem really well. These companies aren’t just selling data; they’re selling convenience and the elimination of a tiny slice of travel anxiety. But it raises a question: is this a sustainable, standalone market, or just a feature that the big carriers will eventually co-opt and bundle? Vodafone’s already dipping a toe with that UEFA football eSIM partnership.
The hardware push
Travel apps create demand, but the real structural shift is coming from the devices in our pockets. Apple going eSIM-only in the U.S. with the iPhone 14 was a huge signal. Google following with the Pixel 10 this year reinforces it. Now, with the iPhone Air and expanded eSIM-only options, the pressure is on. The battery life bump is a nice perk, but the real game-changer is China. Once Chinese manufacturers like Xiaomi and Oppo start baking eSIM into their mid-range and budget phones—which they will now that domestic carriers are on board—the global adoption curve will steepen dramatically. These brands dominate in Asia and Africa, markets that are incredibly price-sensitive. If they make eSIM a standard feature, even as a dual-SIM option first, it becomes normalized for hundreds of millions of people. It’s a classic tech domino effect.
The clunky reality
Now, for the cold water. The user experience still kinda sucks for a lot of people. Needing a second device to scan a QR code sent to your email when you land in a foreign country? That’s not seamless. It’s a huge friction point that the article rightly highlights. And then there’s the sheer lack of awareness. As Airalo’s CEO said, you can’t just tell people to download an app for something they don’t understand. This is where the industry has a massive education gap. It’s also where legacy telecom systems become a huge anchor. For many carriers, moving to fully digital eSIM provisioning means overhauling ancient back-end systems and store processes. They’ve been slow because, frankly, the physical SIM card ecosystem works fine for them and locks you in. Breaking that inertia is hard.
Consolidation coming?
So what’s next? I think the investor commentary here is spot-on. The market is hot, but it’s going to saturate. We’re already seeing a range of players, from pure-play startups like Truely and Kolet to security giants like Nord (with Saily’s new Ultra plan) to the carriers themselves. In a few years, we’ll see consolidation. The winners will be those with the best partnerships (airlines, banks, travel apps), the most reliable global coverage, and brands that travelers actually trust. The domestic market is the next frontier—using that travel “aha moment” to get people to switch their primary line to eSIM. But that requires the carriers to get their act together. For now, the action is all in your carry-on. And honestly, if you’re a frequent traveler and haven’t tried one of these apps yet, you’re probably overpaying for data.
