Let’s start from the beginning.
A SIM card is a “subscriber identity module.” Required in all GSM, LTE, and 5G phones, it’s a chip that holds your customer ID and details of how your phone can connect to its mobile network, what radio frequencies to use, etc.
There’s really no reason to put this information in a circuit, though it does provide some protection from tampering. A more complex circuit could be built into the phone, what’s called an “eSIM”. The advantage to the phone company is that they can exchange encrypted messages with the phone over wifi to set it up. They don’t pay for a piece of plastic, or have to send it out, …. The advantage to the user is that a phone can hold lots of eSIMs, I think an iPhone can hold 8, and two can be active at a time – so two different numbers cause your phone to ring to get a SMS message.
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