James Lee Phillips
Mar 30, 2012

How Apple's nano-SIMs ruin a FRANDship

The memory film from a micro SIM card without the plastic backing plate, next to a US dime, which is approximately 18 mm in diameterYou know about SIMs, right? Not the Will Wright virtual life kind, but the Subscriber Identity Modules that live in your smartphone. They maintain your basic data and bottom-level passwords, even when you swap the devices that they’re plugged into. Or, conversely, they allow you to keep the same device and simply swap SIMs (e.g., when switching carriers, or traveling abroad).

In the 1990s, SIMs started huge (as in credit-card-sized), but soon found a more petite form factor: the Mini-SIMs that reside in the vast majority of current devices. At the beginning of 2010, Apple premiered the even-smaller Micro-SIMs -- ironically, not in that year’s iPhone, but rather the larger iPad. The move was criticized as making it even more difficult to navigate changes of carrier, location and connection amidst the conflicting restrictions of technology and contractual obligations (GSM, CDMA, WiFi, LTE, carrier and manufacturer exclusivity, etc etc) -- but as usual, the heroic hackers came to our rescue (somewhat) by demonstrating how easy it was to trim Mini-SIMs to fit Micro-SIM slots.

Fast-forward two years, and we now have a heated argument going on in the European Telecommunications Standards Institute (ETSI) over giving FRAND (fair, reasonable and non-discriminatory) status to one of two competing proposals for the fourth generation of SIM cards: the Nano-SIM.

What are the benefits of a Nano-SIM? Well, they’re about 60% smaller, and ... that’s about it. But let’s not downplay the considerable benefits of simply making room on a phone. Aside from the cosmetic, pragmatic and eminently marketable appeal of smaller and / or thinner phones, every nanometer of space reclaimed by using a smaller SIM is a nanometer that can go toward more memory and longer battery life, among other things.

A mini-SIM card next to its electrical contacts in a Nokia 6233

The Nano-SIM is ostensibly an evolution of the trimmable Micro-SIM; while Apple does not (and probably will never) officially encourage physical modification of the cards, the company’s recently-patented Nano-SIM tray-loading ('drawer') mechanism ostensibly makes it possible to trim older SIMs even further to fit the new spec. The placement of the contacts is the key factor -- and the competing proposal by Nokia et al is structured differently enough to potentially preclude this factor.

To be fair, Nokia’s version of the Nano-SIM needs no extra parts, no mounting ‘cage’ or ‘tray’ components; it’s inserted, held in place and ejected like an SD card. Early criticisms of Apple’s format included the speculation that a standardized Nano-SIM format would allow Cupertino the loophole of licensing those extra requirements -- but Apple seems to have removed this obstacle with a recent pledge “to grant royalty-free licenses for any patents essential to” the Nano-SIM standard.

Nokia’s other angle of attack (pun intended) is the likelihood of users getting Apple’s Nano-SIM stuck inside the slots. It’s a fair criticism; these SIMs are not only tiny things for those of us with human-sized hands to fumble with, but also nearly the same length (12.3mm) as the width of Micro-SIM slots (12mm). Nokia’s Nano-SIM, on the other hand, is just small enough to not get jammed at all (compatibility notwithstanding). And let’s not forget that every extra nanometer saved ... exactly. By saving not only a millimeter or two of SIM space but also the surrounding ‘drawer space’, Nokia has some justification for calling their design “technically superior.”

Still, at the fundamental level, we have a platform war not much different than VHS vs Betamax or HD DVD vs Blu-ray. As with all other platform wars, the technical superiority of one side is rarely a deciding factor.

The next level of the ETSI debate is more complex, and involves the method of standardization. One of the chief (although technically non-direct) goals of FRAND patents is to avoid the messy economic fallout of platform wars. By establishing a standard before the technology in question has infiltrated the marketplace, consumers and corporations alike are spared ‘Betamax damage.' The fact that this battle is going on in the European venue, among ETSI, may or may not be significant; although the US is more likely to favor the marketplace as a deciding venue, the nano-SIM that 'wins' in Europe 

is almost a foregone conclusion for the choice of standards-based patents in the US as well.

But there are levels atop this, and that’s where the conflict gets particularly pointed. The stated purpose of standards-based patents is to encourage competition by not requiring all competitors to pay exorbitant license fees to the patent-holder. Obviously, whoever holds the patent still has an advantage -- the FRAND license limits fees, but does not eliminate them entirely. Apple has taken the very unusual step of offering royalty-free licenses on its Nano-SIM and even on the associated ‘technology’ (in this case, meaning the cradle or drawer that the card needs to fit into).

Micro-SIM and mini-SIM, as normally supplied in full-sized carrier cards

This unusual step is enough for otherwise sensible analysts to start gushing about Apple’s generous nature. It’s especially significant (the argument goes) because Apple has been such a patent bully in other areas. As you can probably tell, I’m not sure that I buy this line of thought; there could be any number of reasons that Apple offered the royalty-free offer, and none of them bear more than a passing resemblance to generosity.

The most simple explanation is that they just HAVE to win -- even without a revenue source, owning the standard would be something of a coup. I’ll admit, I don’t spend much time with people who have far too much money, but the ones that I do know share at least one quality: they’re all obsessive about playing to win, no matter how much or how little they have riding on the game.

The 'generous' description is hard (but not impossible) to reconcile with reports of Apple seemingly trying to stack the ETSI deck in its own favor. Registering European subsidiaries as ETSI voting members and voting by proxy is not going to win Cupertino any good sportsmanship awards.

More pragmatically, there are advantages that aren’t directly related to the revenue off of the Nano-SIM and related patents. There’s PR, for one -- Apple may be getting a bit tired of hearing negative press (factual or merely envious -- does it ultimately matter if there’s enough of it?). They lost any credible claim to a 'think different' underdog status about the same time that Gates left Microsoft, and it certainly must be hard to keep up the ‘happy sharing caring creative’ ethos once you’ve established a virtual monopoly in various markets via closed-source development and high-visibility litigation. Oh, and wild but captivating rumors of sickened, mutilated and suicidal outsourced workers can’t help much either. A 'generous' royalty-free offer is something that Apple will be able to point toward for years to come.

Even more pragmatically, it pulls the licensing rug out from under Nokia, Motorola and RIM. The royalty-free offer is not simply reciprocal in terms, it’s reciprocal in intent. In other words, if Nokia doesn’t come back with a similar offer, they’re going to look a bit like greedy patent trolls themselves. Nokia is already appearing to be a bit of a poor sport, threatening to withhold its own support for standardization in the event of an Apple win. The official line from Nokia is that Apple is “misusing the standardization process," and they may have a valid point -- but it doesn’t change the fact that it appears as if Apple is offering a quick and generous solution while Nokia is being difficult. 

Of course, Apple is looking further into the future than simply making SIM cards smaller -- ultimately, the company wants to eliminate them altogether, taking the cloud-based route to subscriber identity. We’ll leave the pros and cons of that controversial proposal for another day.