Skip to main content

How Industry 4.0 Will Fuel 5G Global Revenue Growth

New research has focused on the economic value of fifth-generation (5G) wireless communication technology, the Internet of Things (IoT), and how they enable the development of new vertical industry applications.

5G will dramatically gain importance in providing wireless connectivity to industrial environments, especially in the context of Industry 4.0 and the automation of production processes and monitoring of machine conditions.

5G Infrastructure Market Development

According to the latest worldwide market study by ABI Research, by 2026 there will be 5.3 million 5G connections on the factory floor which will generate revenue of more than $184 million -- that's a CAGR of 623 percent between 2021 and 2026.

"As a technology, 5G will be a perfect fit to provide wireless connectivity on the factory floor, since it enables, for example, establishing a massive wireless sensor network or implementing Virtual Reality (VR) and Augmented Reality (AR) applications for predictive maintenance and product monitoring," said Leo Gergs, research analyst at ABI Research.

5G offers immense operational benefits and productivity enhancements to the implementing manufacturer. Furthermore, the technology opens up new production opportunities by enabling artificial intelligence (AI) applications to be integrated into manufacturing processes.

Early 5G trial deployment projects at companies such as Schneider Electric in France and Germany’s Osram, and Mercedes hint that bringing 5G connectivity to the factory floor will decrease maintenance costs by 30 percent and increase overall equipment efficiency by 7 percent.

While there are many use cases and areas of application for 5G in industrial manufacturing, targeting the enterprise vertical will fundamentally change the value chain associated with 5G.

However, a much closer collaboration between network operators, infrastructure vendors, and manufacturers will be required.

According to the ABI assessment, targeting enterprise verticals is vitally important for telecom service providers and the successful deployment of 5G infrastructure and associated product offerings.

A recent Return on Investment (ROI) study has shown that 5G infrastructure will take approximately 14 to 15 years to break even if it remains solely in the consumer market, versus 10 years if enterprise business models were developed with effective target marketing.

Outlook for 5G Innovation and Revenue Growth

"It is, therefore, highly important for network operators and infrastructure vendors to develop new business strategies taking into manufacturers’ requirements. Centrally, this should include moving away from selling connectivity as such and develop attractive pricing models for additional network capabilities," concludes Gergs.

Industry 4.0 is a subset of the fourth industrial revolution (4IR). Did you know that 1TB of production data is created daily by the average factory, but less than 1 percent is analyzed?

Industry 4.0 innovations make use of that raw data to uncover insights, predict failures, prescribe fixes and optimize assets -- significantly reducing costs and improving factory productivity.

Popular posts from this blog

Artificial Intelligence Growth at an Inflection Point

Business technology investment no longer follows a predictable path to growth. The global venture capital (VC) investment in artificial intelligence (AI) was close to its peak in 2021 reaching $22.3 billion, according to the latest worldwide market study by ABI Research. This is just $400 million shy of the historical high of $22.7 billion recorded in 2019. Compared to the $15 billion recorded in 2020, the market made a remarkable recovery, with a 48.5 percent year-on-year growth. Will the future AI marketplace return to stable growth, or will it remain volatile? Artificial Intelligence Market Development "COVID-19 greatly accelerated the speed of digital transformation within the enterprise. Businesses are looking for solutions to work processes automation, customer care, due diligence, transcription and translation, and sales and marketing enablement tools," said Lian Jye Su, research director at ABI Research . At the same time, COVID-19 led to the Great Resignation of 2021

How a Digital-First CEO Leads Transformation

Some leaders reject the notion that "wait and see" is the best response to disruptive change. Savvy senior executives are already driving digital business transformation throughout their organization in an effort to gain a bold strategic advantage. According to the latest market study by International Data Corp (IDC), Digital-First CEOs plan to drive at least half of their income from digital business products, services, and experiences by 2027 -- that's ahead of the market average of 39 percent. Driven by their response to the COVID-19 pandemic, these business leaders have changed how they think about the relationship between business and technology, and how they approach the next digital transformation era -- from scaling digital technology to guiding a viable digital business. Digital Business Market Development IDC defines digital business as value creation based on technology, which entails: 1) Automated customer-facing processes and internal operations; 2) Provision

Digital Solutions for Industrial & Manufacturing Firms

Executive leaders of fast-moving consumer goods (FMCG) are seeking guidance on how to apply new business technology in their manufacturing operations. CIOs and CTOs are tasked with gaining insight into the best solutions for digital transformation. ABI Research evaluated the impact politics, regulation, the economy, supply chain, ESG, and technology are having on FMCG, pharma, producers of steel, chemicals, pulp and paper -- as well as the mining and oil & gas sectors. Digital Transformation Market Development "Our assessment found that the FMCG sector is under pressure from all sides," says Michael Larner, industrial & manufacturing research director at ABI Research . Securing raw materials is challenging considering lockdowns in China and limited grain supplies from Ukraine. Supply shocks are raising input costs, and operating costs are rising with higher energy costs coupled with the pressure to pay higher wages and work sustainably. "We all hoped that with th