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Unleash the full potential of Industry 4.0 with advanced connectivity

Unleash the full potential of Industry 4.0 with advanced connectivity

Industry 4.0 and why connectivity matters

The fourth industrial revolution unlocks powerful new use cases – from predictive maintenance and an augmented workforce to autonomous robots and digital twins. Cellular technologies are at the core of these innovations, enabling seamless communication between man, machine, system and sensor. Discover how to leverage connectivity and unlock the full potential of Industry 4.0 applications.

What is Industry 4.0?

Industry 4.0 represents the next chapter of digitalization and is one of the most disruptive shifts in manufacturing since the steam engine. Also known as the fourth industrial revolution or 4IR, it connects machines, systems and people through advanced technologies to create automated, intelligent and responsive industrial environments.

At the heart of Industry 4.0 lies the Industrial Internet of Things (IIoT), enabling machines to “talk” to one another, as well as human operators. This seamless communication facilitates real-time data exchange and insights, driving efficiency, productivity and more flexible operations. It also improves and accelerates data driven decision-making, while supporting innovative new use cases.

The power of IIoT, multiplied by private cellular technology, unleashes a new world of opportunities that could not exist previously. Cellular connectivity – especially private networks – serve as the critical enabler, delivering the fast, reliable and secure connectivity necessary for these high levels of industrial automation and data exchange.

Traditionally credited to manufacturing, Industry 4.0 is extending far beyond, revolutionizing nearly every industrial sector, including ports, mining, oil and gas, energy and airports, making business critical operations smarter, more adaptive and efficient.

What is Industry 4.0?
Already familiar with Industry 4.0 and thinking about deployment opportunities?

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Industry 4.0 requirements

Industry 4.0 in action

Picture a large industrial operation. Advanced technologies such as 5G, IIoT and AI integrate every machine, robot and system into an intelligent network.

Smart sensors monitor performance in real-time, feeding data into a cloud-based platform. Operators track equipment status on digital dashboards, enabling them to identify and address issues before they arise. Robots collaborate with humans, handling repetitive or dangerous tasks and communicating with one another to optimize workflows and prevent downtime.

Engineers use digital twins – virtual replicas of physical systems – to test adjustments and improvements without disrupting operations. AI-driven predictive analytics reduce downtime by forecasting maintenance needs, while automated systems continuously adjust operations for maximum efficiency.

Industry 4.0 in action

The historical context of the fourth industrial revolution

The historical context of the fourth industrial revolution

The surge towards industrial automation and digitalization started with the third industrial revolution. Innovations such as computers, microprocessors and enhanced connectivity technologies enabled machines to follow complex instructions, simulating independent thought. Culminating in the birth of the internet, connectivity was revolutionized: people, processes and businesses were linked like never before.

4IR builds on these foundational developments by leveraging the significant advancements in IIoT and cellular technology to merge the digital and physical worlds. In this era, everything is connected – not just machines but entire supply chains – driven by industrial automation, machine learning, and the digitization of production processes.

Industry 5.0: a human-centric approach to sustainable production

As advancements in the fourth industrial revolution continue to accelerate, Industry 5.0 will raise the question: what does this mean for society? A relatively new concept, Industry 5.0 envisions machines as collaborators, rather than replacements, to enhance human creativity, lateral thinking and problem solving. For example, workers could be equipped with robotic exoskeletons to ease the load of physically demanding tasks, or collaborate with robotic coworkers that prevent them from entering unsafe environments.  

The ongoing adoption of new technologies and making wireless connectivity the foundation of smart factories will be essential in an Industry 5.0 future. Upskilling and reskilling the workforce will be equally important, empowering employees to feel more valued and capable as they increasingly collaborate with machines to achieve sustainable production.

Discover Industry 5.0

What are the key technology drivers of Industry 4.0?

Transitioning into the fourth industrial revolution will depend on the successful adoption of many new technologies, which can be categorized into the four key areas below. Together, these Industry 4.0 technologies bridge the physical and digital worlds to enable smart, autonomous systems.

 

Connectivity and security technologies form the backbone of Industry 4.0. These technologies empower industries to create interconnected environments that drive innovation in a secure digital landscape. Technology drivers include:

  • IoT and IIoT
  • 5G connectivity / private cellular networks
  • Edge computing
  • Cybersecurity

Automation and intelligent systems drive the shift towards smarter, self-optimizing processes. By leveraging advanced algorithms and data-driven insights to automate complex tasks, these technologies empower enterprises to create autonomous systems that continuously adapt to changing conditions and optimize performance in real-time. Technology drivers include:

  • Artificial Intelligence (AI)
  • Machine learning (ML)

The ability to create, store, analyze and simulate vast amounts of data in real-time has revolutionized industrial processes. Data management and analytics technologies provide the foundation for this transformation, enabling enterprises to turn raw data into actionable insights. Technology drivers include:

  • Cloud computing
  • Big data
  • AI analytics
  • Simulations / digital twins

Connected assets enable seamless interaction between humans, machines and their environment. These technologies boost workforce efficiency, enhance productivity and improve safety. Technology drivers include:

  • Augmented reality (AR)
  • Autonomous robots
  • Virtual reality (VR)

 

Industry 4.0 opportunities

The value of the fourth industrial revolution lies in the transformative opportunities it presents to industrial sectors. Let’s take a look its main advantages below.

Industry 4.0 opportunities
  • Increased efficiency and productivity: optimize processes, reduce waste and lower operational costs with industrial automation and advanced data analytics.
  • Greater flexibility and agility in operations: quickly respond to shifting market conditions and evolving customer demands with Industry 4.0 technologies.
  • Enhanced decision making: make more informed, faster operational decisions, in real-time, with data-driven insights.
  • Driving innovation through new use cases: unlock vast new opportunities for innovation, including predictive maintenance and improved worker safety.
  • Accelerating climate action: Leveraged in the right way, digital technologies can reduce global emissions by up to 15% by 2030. It also creates opportunities for new business models that enhance safety, inclusivity and affordability.

Connectivity requirements: shifting from wired to wireless

Connectivity is one of the most important requirements of Industry 4.0 and, while there are multiple ways to connect an industrial environment, significant gains await those that cut the cables and go wireless. Offering enhanced flexibility and adaptability, cellular connectivity supports the business outcomes that industry expects from the fourth industrial revolution.

However, the state of readiness varies widely depending on the country, sector or individual companies. In addition, selecting the right connectivity solution requires careful evaluation of specific network performance requirements, such as latency, throughput, device density, reliability and energy efficiency needs.

While most factories still rely on wired connections, this setup increasingly presents challenges for modernizing the factory floor. Hard-wired systems are tethered to fixed equipment locations, requiring costly cable installations for upgrades or expansions. This inflexibility also undermines adaptability and responsiveness, complicating rapid facility reconfigurations and making mobility near impossible. Tellingly, ABI Research estimates the number of wireless connections in factories will grow at a Compound Annual Growth Rate (CAGR) of 55% between 2019 and 2030, compared to 12% for wired connections during the same period.

 

Although Wi-Fi and cellular technology are expected to coexist for the foreseeable future, Wi-Fi often struggles with the reliability, low latency, security and device density demands of Industry 4.0 applications. It is not optimized for mobility, experiencing up to 15 seconds of latency during handovers, disrupting real-time data exchange. Its reliance on multiple access points can also create dead spots, complicating connectivity in large industrial environments. Within an Industry 4.0 context, these limitations hinder advanced applications such as asset tracking and autonomous guided vehicles, ultimately restricting the potential of enhanced efficiency and innovation.

Cellular technology presents a practical alternative to fixed connections, offering key benefits such as improved mobility, reliability and the capacity to support high device density (the number of connected devices per square meter). While public cellular networks are widely available and technically capable of supporting the typical needs of an Industry 4.0 environment, they can  easily become overloaded as bandwidth is shared amongst multiple users. In addition, their open nature makes them more susceptible to cybersecurity breaches, presenting a key barrier for the highly secure and reliable communication demands of 4IR applications.

 

Private cellular networks – an on-premises network deployed for an organization’s exclusive use – offer additional features over public networks. It leverages industry and licensed spectrum with Ericsson's best-in-class radio portfolio, ensuring extensive, reliable and dedicated coverage. SIM-based authentication and enhanced data encryption secure critical data and ensure it is inaccessible to outside parties.

The reduced cabling need translates into cost savings, while centralized control ensures seamless mobility for IIoT devices. Private networks are also highly scalable, easily supporting new devices or applications, and offer flexible deployment options: on-premises or in the cloud. With full control over data flows, high availability and easy integration with existing LAN infrastructure, private networks unlock powerful Industry 4.0 use cases like automation, AI and IIoT.

 

Why private 5G connectivity is driving new use cases

Private 5G technology introduces several new features in the industrial domain by providing ultra-low latency, high throughput and superior performance in high device density environments. These features are essential for the advanced industrial applications of Industry 4.0.

Additionally, private 5G technology is governed by a global value chain that adheres to a single standard, ensuring widespread compatibility and scalability. This standardization has enabled cellular networks to achieve economies of scale, resulting in cost-effective device and connectivity module prices. Private 5G networks also offer greater mobility, reliability and security compared to any other communication standard.

With powerful solutions already available, industrial environments can implement many Industry 4.0 use cases today, paving the way for a seamless transition to ever smarter, more efficient operations.

Increased insights and reduced costs through digitalization

Wireless sensors, cameras and drones to feed digital models and AI analytics, reducing operational costs by enabling data data-driven decision making.                                                                                                                            

Improved operations through automation                                         

Automation and remote operation of all moving vehicles improves operations, while wireless connectivity ensures fixed machines are flexible and efficient to automate.                                                                                               

Increased safety with connected assets and workforce

Location awareness improves safety by enabling emergency stops and automatic speed adjustments of vehicles, machine warnings and automatic shutdowns, and monitoring worker health and falls.

Improved efficiency with connected assets and workforce

Extended reality (XR) enhances efficiency with remote expertise and guidance, while asset management is streamlined by connecting asset status and position.                                                                                                             

Why private 5G connectivity is driving new use cases

No factory can afford to be left behind in the shift to smart manufacturing. Failing to innovate in products and production processes could lead to a significant Cost of Inaction (COI) – the cost of missed opportunities. Deploying dedicated cellular-enabled Industry 4.0 solutions can yield a significant return on investment (ROI) and operational cost savings.

Smart manufacturing use cases and applications

No factory can afford to be left behind in the shift to smart manufacturing. Failing to innovate in products and production processes could lead to a significant Cost of Inaction (COI) – the cost of missed opportunities. Deploying dedicated cellular-enabled Industry 4.0 solutions can yield a significant return on investment (ROI) and operational cost savings.

10x – 20x

ROI over 5 years*

 

8,5%

Operational cost savings*

USD200-600 million

Operational cost savings per sqm per year*

Source: ABI Research report: Smart manufacturing and how to get started. *Use case and type of manufacturing site dependent.

While there are many potential smart manufacturing use cases, our research highlights five that stand out as the most mature and promising starting points. These use cases not only offer substantial financial returns – typically paying for themselves within three to five years – but they also contribute positively to social and environmental outcomes.

With 5G-enabled private cellular networks, AMRs can navigate factories without the need for magnetic strips, providing precise positional accuracy even in crowded environments. AMRs boost productivity and worker safety by efficiently navigating hazardous areas, while significantly reducing material scrap rates by up to 30% through more accurate material handling. Beyond manufacturing, AMRs also present significant opportunities in other industries like ports, mining and airports.

50%
ROI in year five*  

>4 years
Payback period*  

*Use case and type of manufacturing site dependent.

AR enables inspectors to view 3D models and data overlays directly on equipment, minimizing the need for manual reference checks and reducing physical strain. It also enhances remote support, enabling experts to assist on-site technicians and operators in real-time, reducing travel by up to 50% and significantly lowering CO2 emissions. For AR use cases, high-speed wireless connectivity with precise positioning is essential, which is best provided by private cellular networks capable of handling rich media and high device density. Beyond manufacturing, AR offers substantial opportunities in especially the oil and gas, as well as airport industries.

68%
ROI in year five*

 

<3 years
Payback period*

*Use case and type of manufacturing site dependent.

Also known as cobots, collaborative robots work alongside operators to perform manufacturing tasks such as drilling, assembly and automated quality inspections. They can also be used to improve worker safety by handling potentially hazardous tasks. With 5G-ready private cellular networks, cobots can easily be reconfigured for different tasks, allowing them to flexibly adapt to changing manufacturing needs.

44%
ROI in year five*

 

<4 years
Payback period*

*Use case and type of manufacturing site dependent.

 

Digital twins enable manufacturers to visualize both current and historical production sites, facilitating planning through “what if” scenarios. They generate actionable insights that improve asset efficiency, enhance productivity and mitigate operational risks, allowing for cost savings through optimized production. Effective use of digital twins depends on the ultra-high security, high bandwidth and reliable connectivity of private cellular networks to process large volumes of data from 3D sensors, video streams, lidar and thermal imaging in real-time. This use case also presents opportunities in the oil and gas industry where digital twins can optimize asset management, safety and operational efficiency in complex, high-risk environments.

28%

ROI in year five*

 

<4 years

Payback period*

*Use case and type of manufacturing site dependent.

Automated asset condition monitoring optimizes maintenance by preventing both under- and over-servicing, reducing spare part requirements by 10% and minimizing repetitive tasks for employees. This extends equipment lifespan and promotes sustainable operations. Efficiently processing and managing data – enabled by high reliability, high-speed, high throughput connectivity – is central to effective asset condition monitoring. This use case is highly applicable not only in manufacturing, but also in sectors like ports, mining, oil and gas, power utilities and airports where maintaining asset performance is critical to operational efficiency.

151%
ROI in year five*

 

<3 years
Payback period*

*Use case and type of manufacturing site dependent.

Why private 5G connectivity is driving new use cases

Strategic resources to guide your journey

Industry 4.0 hurdles: overcoming key challenges

Transitioning to the fourth industrial revolution offers immense potential, but there are many challenges that could arise during its implementation. Let’s take a look at some common hurdles and how to navigate them effectively.

Industry 4.0 hurdles: overcoming key challenges

Key challenges

  • Legacy infrastructure: outdated IT systems that are unable to support the network density and data volumes demanded by Industry 4.0 applications.
  • Equipment interoperability: legacy equipment that lack the sensors or connectivity necessary for integration into a smart factory.
  • Connectivity and latency: existing cables and Wi-Fi systems that cannot meet the quality of service or low latency demands of Industry 4.0 applications.
  • Deployment costs: required investment to integrate IIoT systems with older manufacturing technologies that often operate on different standards.
  • Data security and control: increased exposure to cybersecurity threats as more machines and business systems are being connected via the internet.

Proven strategies for successful deployments


Knowing when to engage and how to identify the best path forward can be challenging. Below are some proven strategies to help navigate and overcome common obstacles in your transition to Industry 4.0.

Assess your current state

Take the time to analyze your existing legacy infrastructure to understand where you stand and where you aim to go. Having a clear baseline is essential for planning your strategic advancement.  

Determine readiness

Drill down to your key product lines, target audiences and essential partners. Identify which elements of your legacy systems can be integrated into a cohesive digital strategy, which ones to retain and which should be replaced entirely.

Embrace proof of scale

After achieving the intended performance targets, take decisive action by fulfilling your commitment to the technology. Many projects tend to stall in the proof-of concept stage without this level of commitment. It is equally, if not more, important to focus on proof of scale as it is on proof-of-concept.

Revise and repeat

Identify what works and eliminate what doesn’t. This means employing a results-driven approach, embracing flexibility and fostering a culture of innovation.

Related industries and topics

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Internet of Things

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Why choose Ericsson

Enterprises implementing Industry 4.0 need fast, reliable, secure wireless connectivity solutions. Ericsson offers the broadest portfolio of private 5G and neutral host network solutions, leveraging best-in-class radio, software and managed-operations capabilities to enable flexible enterprise solutions. Purpose-built for industrial environments, our solutions range from fully customizable to off-the-shelf and provide secure, reliable coverage, high device density, predictable latency and full visibility of machines, processes and data.

Coverage

Achieve greater connectivity and efficiency with expansive coverage and fewer infrastructure needs, indoor and outdoor, reducing total cost of ownership (TCO) while offering flexible deployment options to connect more devices over large areas.

Mobility

Maximize operational efficiency and productivity with seamless mobility and fewer handovers. Our networks support higher capacity of IIoT and automation, ensuring uninterrupted workflows.

Reliability

Keep critical processes running smoothly with reliable network performance, ultra-low latency for time-sensitive applications and predictable service levels.

Leadership

Leverage our global expertise with our global solutions backed by regulatory certifications and strong partnerships. Our extensive network enables us to support global enterprises with deployment and manager services wherever they operate.

Explore our private network portfolio

Ericsson offers the broadest portfolio of private 5G and neutral host network solutions with a choice of local cellular networks. Whether it’s simple and prepackaged, or tailored and comprehensive, we have the solution for you.

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Recognized by industry experts

Ericsson is a recognized leader in both public and private 5G networks, known for our market success, comprehensive portfolio and commitment to sustainability. Our innovations and expertise continue to shape the future of connectivity, earning us industry-wide recognition for delivering reliable, scalable solutions that drive digital transformation globally.

Gartner®

2024 Gartner® Magic Quadrant™ for CSP 5G Core Network Infrastructure Solutions

Ericsson was recognized by Gartner® as a leader in the 2024 Gartner® Magic Quadrant™ for CSP 5G Core Network Infrastructure Solutions.

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TM Forum

Omdia | Market Landscape: Core Vendors 2024

Ericsson recognized as leader for Core portfolio in Omdia Market Landscape for Core Vendors 2024.

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Frost & Sullivan

Frost & Sullivan | Market leader 4th year in a row

Market research company, Frost Radar, ranked us as 5G market leader for the 4th year in a row.

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ABI Research Sustainability Assessment Telco Technology Suppliers

Ericsson topped the vendor list for Net Zero emission targets.

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