Your cell service provider needs some way to verify that any random cell phone attempting to connect to their network is authorized to do so. If they didn’t make sure of this, people could just connect for free. Also, your cell phone needs some way to know which portions of the cell signal it is supposed to be listening to in order to complete your phone call or data request.
These needs are met by the SIM card, which you have to register with your carrier if you are starting new service. The SIM card provides the information needed so that your cell phone can prove to nearby cell towers that it is authorized to use a particular network, and that information also tells the cell network how to attempt to connect to your phone.
The “SIM” in SIM card stands for “Subscriber Identity Module”. It is a chip which stores a international mobile subscriber identity (IMSI) number, along with an encryption key. These allow a cellular network to identify and securely communicate with individual users as determined by their SIM cards.
Without such a card it would be difficult if not impossible to charge for access to their cellular networks, or to be sure where to properly direct calls and to know who is making them. Associating a SIM card with a particular account with a cellular provider allows them to know what kind of service you did (or didn’t) pay for and to charge expenses to the proper user.
Your SIM card is a smart card.
It is small computer with certain information (a private key) stored in a secure way (you can’t get it out) and this computer specializes in doing computations with that private key.
The result of those computations are used by your phone to proof your identity when you connect to the network. Your network operator is able to verify if that calculation was done by that specific SIM card and requires this so it knows who you are for billing/call routing etc…
Without (secure) SIM cards, you would be able to impersonate other people. (Receive their calls, have them billed for your calls, etc…)
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