I don't know what's the problem Google has with SIM storage.
Because the very limited SIM storage space is completely inadequate for the requirements of a modern smart phone.
Since the beginning of time, mobile phones give you the option to store both your messages and your contacts to the SIM card, and to move them to/from the phone memory.
Yes the SIM card was introduced 20 years ago, phones have changed a lot since then, AFAIK SIM cards haven't.