Do you need the phone to have a network connection effectively 24/7?
If so then you are going to need a Sim in all probability.
If you can get by with more limited connectivity then relying on WiFi without a SIM is possible.
If your phone has a SIM then it becomes inherently privacy limited against your telecom, anyone they sell the data to, the government, and anyone who can compromise the systems. A SIM let's you talk to the cell towers and in doing so they know a lot about you (including your location with a fair degree of precision). There is no real way to avoid this tracking.