SIM: The smartest smart card of all

The SIM (subscriber identity module) inserted into the cellular phone for GSM network identification and authentication is the most widely utilised smart card of all.

It stores network parameters, users` phone books and SMS messages, but its most important function is to securely identify the subscriber to the operator network, essentially tying the subscriber to their service provider. It is because of the SIM card that operators have the type of hold on their clients that even banks cannot exercise over their customers.

The SIMs most widely used today are capable of storing either 64KB or 128KB of data. Memory capacities of 256KB and prototypes of a megabyte capacity are in the pipeline, says Andrew Turpin, Director of the PayPoint Business Unit at Prism. And with the increase of the SIMs memory - there`s ample capacity on the chip to store a host of data and applications alongside GSM requirements.

"In essence, the SIM card acts as a processor within the cellular phone - it can be programmed to store authentication and encryption algorithms, phone lists and mobile banking applications," he says.

"Sales force automation and other value-added services such as prepaid electricity and business applications can also be made available. Selected applications and content are currently downloaded OTA (over-the-air) to the SIM by the operator, or content provider on behalf of the subscriber.

Historically, operators could differentiate themselves by means of the technical capability of their SIM only being able to offer value-added services within the limitations of the chip technology. There is a move afoot among operators to settle on globally agreed and standardised chip technology such as JavaCard or the OTA2 standard for China because it is expected to substantially reduce procurement costs, and therefore technological differentiation in the market will give way to service and application differentiation.

This trend, together with universal numbering schemes, may see subscribers being more easily able to move from one cellular network to another or it may see increased competition based on creative new service offerings.

Prism has developed some 40 different plug `n play programs that extend the functionality of the standardised SIM offered by network operators, including a range of various security applications.

"For example, we have developed a bank-strength encryption suite, which makes it safer to transact using one`s cellular phone, and another that provides multiple phone books and allows the subscriber to manage these. In more mature mobile markets, such as the Philippines, individuals can make use of their SIM as an electronic wallet and load funds onto it from a linked bank account or credit card, he says.

Funds may then be transferred securely from one user`s wallet to another via the handset SIM using the cellphone menus.

Prism has developed bank-strength security for MTN Nigeria to enable the operator`s prepaid subscribers to transfer or top-up airtime value over-the-air via a Virtual Top-Up solution. Of critical importance to all parties involved in the transaction is the end-to-end security that had to be built into the system.

Turpin says the company won a Technology Top 100 award with this chip-based technology last November.

Another chip that has found its way into cellular phones more recently is the FlashCard, being a convenient and easy way to store and transport digital content such as photos, movies and MP3 sound files. Flashcards capable of storing up to 1GB of data are now available.

As handset capability is extended, to be seen with several new PDA (personal digital assistant) phones now available, these FlashCards are likely to play a bigger role in interacting with the handset and interacting with the secure programs and applications stored on the SIM.

He says the need for DRM (digital rights management) tools, which allow content providers to ensure the content they own, will drive the ongoing evolution of both the SIM card and the FlashCard. DRM tools will prevent content such as MP3 music titles and video clips from being copied from one phone to another once they are downloaded to a user`s SIM.

A healthy debate now exists as to where DRM capability should reside; on the FlashCard near the data it protects which will mean that FlashCards will need to include processor capability, or on the SIM card where there is ample processing power but which is `far` from the content it is protecting.

"One thing is clear though, both these kinds of chip cards now have an established place in mobile handsets and it will be interesting to see how mobile operators can translate this powerful combination of storage capacity and processing power into new revenue generating services in the future."