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A SIM card is otherwise known as a subscriber identity module and is used in smartphones globally. It is a smart card which stores data for subscribers of GSM cellular phones. GSM stands for Global System for Mobile communication and is a digital mobile network that is commonly used in Europe, Asia, Africa, and most of the rest of the world. The U.S. is one exception and uses both GSM and CDMA (Code Division Multiple Access).

Phones on the GSM network can use any carrier's network, lowering the costs for the carriers and its users. Europe mandated the use of GSM in 1987 and the phones and equipment for these phones are less expensive to manufacture.

In the U.S., network carriers AT&T (T) and T-Mobile (TMUS) use GSM. The other carriers, Sprint, (S) Verizon (VZ) and US Cellular (USM) use CDMA. If you travel often, a GSM phone could make it easier and cheaper to make phone calls and send texts. If you have a phone on the CDMA network, you can opt to use WiFi to avoid expensive phone calls on a local country's network.

SIM cards are the small cards which contains a chip and are removable and transferable to other phones. In order for a GSM phone to work, a SIM card must be placed into it so you can access the local mobile network to place or receive calls or send texts.

Another advantage is that being on the GSM means any carrier has to accept the calls you are making or texts you are sending. The opposite is true for CDMA phones - you can not decide to switch to a new phone without the permission of your carrier. The carriers for CDMA do not have to accept your phone onto its network.

What Is a SIM Card and Why Do You Need One?

If you have never seen a SIM card, it basically looks like a tiny piece of plastic. This piece of plastic has a a small integrated chip that holds a unique identification number, phone number and other data that links to the consumer.

SIM cards contain a variety of information, such as who is paying for the access and that you have permission to use those features such as placing a call or sending a text. Otherwise, you can only use the phone to take photos or access free WiFi.

Since SIM cards hold the subscriber's information, they come in handy when the battery on your phone is low or needs to be recharged. You can take out the SIM card and place it into another phone and send a text or make another call. Since you have the SIM card in the phone, any calls or texts will show your phone number and that it is coming from you. It does not matter if you are using an Android or Apple  (AAPL) phone.

The SIM card has enough memory to typically store up to 250 contacts, some of your text messages and other information that the carrier who supplied the card can utilize. Photos are not stored on SIM cards, so make sure they are backed up.

Although Verizon and Sprint and phones now have SIM cards in them, the only reason is because both carriers use the 4G Long Term Evolution (LTE) networks since the LTE standard requires the usage of SIM cards.

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There are many nuances to SIM cards. Not all SIM cards are the same. Depending on what country you purchased the SIM card, some of them are locked to the carrier that you bought it from. This means that you can use the SIM card in any phone that is sold by that carrier.

You can buy a SIM card from the carrier where you are subscribing to. If you lose a SIM card, you can purchase another one from your carrier. 

The prices of SIM cards vary from retailer to retailer, depending on how many minutes you are seeking to talk, the number of texts. You can buy SIM cards directly from a carrier like T-Mobile or online from any retailer that sells electronics.

SIM cards can also vary in size, depending on the model of the phone.

How to Replace SIM Cards

Inserting or removing a SIM card is an easy process once you determine where it is stored on your phone. Depending on the type of phone, it could be placed behind the battery. In that case, you will have to open the back panel. For other phones, the SIM cards can be found on the side of the phone.

Removing the SIM card is simple if you have the right tool. Depending on what kind of phone you have, you can easily pop it out of the slot with a paperclip or the edge of something like a credit card. There are some SIM cards that are in easier spots that can slide out with the tip of your finger.

If you are not sure how to insert the SIM card, look up your phone manufacturer's instructions online or watch a video on how to easily replace the card in the right slot.

Are SIM Cards a Hacking Threat?

Hackers are prolific and SIM cards are not immune. Your SIM card is a priority for hackers since it contains your phone number, which is often linked to your email, social media accounts and banking information. One way for hackers to gain access to your SIM card is to call a cell phone carrier and pretend to be you. Once they have done that, they can transfer all your personal data to another SIM card, place it into their phone and start reading your text messages.

Since you can reset passwords through text message, the fraudsters can easily gain access to your bank, social media accounts or email.

If you are concerned that your SIM might have been hacked, use another phone to call your current phone and see if it rings. If it no longer rings, it could mean you have been hacked.

Setting up a PIN or password that is connected to your mobile account can prevent a hacker from accessing your account and pretending to be you in person or over the phone.