The Function of the SIM Card

• As is the case with other cellphones, the iPhone's SIM card allows the device to communicate with your carrier's network, make phone calls and send text messages. One auxiliary function of the iPhone's SIM card is to keep the device connected to your carrier's cellular data network -- when used alongside most service plans with data packages, the iPhone enjoys "always on" Internet. Without a SIM card, it isn't generally possible to make calls or send text messages on the iPhone.
  
  

iPhone Wi-Fi

• The iPhone comes standard with a built-in Wi-Fi adapter -- similar in function to the one you find on your laptop computer -- so it's possible to use Internet-based applications on your phone even if you don't have a SIM card installed. If you have certain applications installed on your phone -- namely, Skype for iPhone -- it's possible to make phone calls and send text messages using it whenever you're connected to a wireless network, although it's important to remember this functionality disappears the moment you step outside the network's range.
  
  

Applications and Utilities

• Several of the iPhone's applications and utilities don't even require the Internet, so removing your SIM card from your device has literally no impact on your ability to use them, regardless of your proximity to a wireless network. Basic tools such as the device's "Calculator" and "Notes" features -- as well as some downloadable games and dictionary utilities -- come installed with all the content you need to use them.
  
  

Multimedia Features

• The iPhone includes a built-in camera -- one which shoots still photos for variants released prior to June 2009 and video for those released after -- and although not having access to the Internet or text messaging can inhibit your ability to share photos and videos you take, taking them is something which doesn't require you to have a SIM card installed. Similarly, using the device's iPod media player doesn't require you to be connected to the Internet or have the ability to call or text.