Essentially, it’s a universal SIM card that works with a variety of wireless carriers. It eliminates the hassle of having to switch SIM cards each time you want to use your device on a different network (while traveling or in areas where service is poor on a certain carrier but better on another, for example).
Apple lists AT&T, Sprint and T-Mobile as participating carriers in the US although early user reports suggest AT&T isn’t exactly playing by the rules.
Multiple users have noted that once you activate the Apple SIM on AT&T’s network, it can only be used on AT&T’s network and you’ll need a new Apple SIM if you want to change carriers in the future. Or in other words, AT&T is basically eliminating the entire point of the new SIM technology.
Apple has acknowledged this behavior in a new support document, highlighting the fact that AT&T dedicates Apple SIM to their network only and that you’ll need to buy a new Apple SIM if you want to use your iPad on another carrier.
When asked why they're locking the SIM card to their network, AT&T spokesperson Mark Siegel said it's just simply the way they've chosen to do it.
At this point, there’s no evidence that suggests other carriers are planning to do the same.
~ Shawn Knight
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