SIM card market is expected to grow 10% in 2010, reaching 3.8 billion shipments, according to a study by ABI Research. Driven by growing connectivity demand, M2M, browser-based services, and new business models, it will continue to grow in volume and value over the next few years as new markets and applications come online.

At the same time, MNOs are evaluating which services are best run on the SIM in an effort to maximize security and combat the threat of third-party application stores, which could limit their future data service revenue.

Principal analyst John Devlin of ABI Research (News - Alert), said, “SIM cards offer operators a direct presence with the end-user; it makes sense that service providers will take advantage of the increased level of functionality, performance and security. With handset manufacturers and companies such as Google (News - Alert) offering their own portals and services directly to end-users, operators need to be able to compete.”

SIM-based applications and browsers can give operators a branded presence and allow customers easy access to targeted services. It's not just within the smartphone sector that this is occurring; innovative services are being delivered via SIM-based browsers in many 2G and developing markets. Volume growth is not just derived from more people buying more mobile phones. A growing variety of devices – both consumer and industrial – are being connected.

Devlin concluded, “New business models such as revenue sharing agreements are being offered to the operators in an effort to stimulate demand for new applications and features. In turn this will drive up software and service revenues for SIM vendors and developers, as well as demanding higher-level silicon, which combine to increase overall market revenues.”

Recently, ABI Research was in TMC (News - Alert) news when the research firm predicted that alternative positioning technologies will generate over $2.5 billion by 2015.