Industry 4.0 will increasingly rely on the high-speed broadband of 5G and the sophisticated technologies it enables. But the coming transformation brings with it both benefits and costs.
According to the Manufacturing Institute, 5G deployment will contribute $227 billion to the manufacturing industry by 2030.
Industry 4.0 requires a high degree of flexibility for uses such as configurable manufacturing lines, automated guided vehicles (AGVs), and autonomous mobile robots. Manufacturers may also have highly critical needs: emergency shutdown requirements, condition-based monitoring, or emergency push-to-talk/push-to-video use cases. To meet those needs, 5G in manufacturing is increasingly viewed as the way to go.
5G Benefits and Costs
5G networks can offer big advantages for Industry 4.0, as MxD research has shown: Ultra-fast speeds and ultra-low latency (delays in transmission of data packets) in some configurations, along with massive connectivity and greater reliability.
As with any technology change, there are significant costs associated with 5G that must be weighed against the benefits it can provide. Manufacturing executives and IT and OT team leaders are right to ask tough questions about the return on investment (ROI) from a 5G switchover.
Evaluating the benefits and costs of implementing 5G in a manufacturing environment requires a strategic, use-case-driven approach. Manufacturers should make their assessment based on specific operational goals like automation, real-time monitoring, or flexible production.
The ROI for private cellular networks may not be widely known, some industry experts say. U.S. manufacturers face uncertainties and may be hesitant to adopt new technology.
“It is important for everyone involved in promoting Industry 4.0 in manufacturing settings—including system integrators and mobile network operators— to recognize the cost-saving benefits of 5G and private cellular, with an eye toward flexibility with its use,” said Michael Howard, a senior project engineer for MXD.
5g impact on manufacturing
Here are examples of how to weight potential ROI impact, with more details available at MxD’s 5G portal:
Efficiency of 5G
By streamlining processes and operations, private 5G networks can yield a potential $1 billion for a Tier 1 factory in the United States (those that directly supply finished products or components to an original equipment manufacturer) over a five-year period, according to a forecast by ABI Research, on behalf of MxD. Faster and more reliable robotics using 5G can improve process flow with minimal human intervention. Defect rates can drop because artificial intelligence (AI) systems using 5G can catch and correct issues in real time.
5G Cabling costs
Typical industrial Ethernet cable is not cheap. With a switch to 5G, an average factory could save hundreds of thousands of dollars yearly on Ethernet cable costs alone, based on an estimated cost per-cable drop of $225, ABI Research found. For factories with frequent layout changes, wireless 5G means no need to re-cable with each configuration, and for older facilities, the disruption and costs of retrenching can be avoided.
The Speed of 5G
The ultra-fast, low-latency, high-capacity wireless connectivity in 5G systems can unlock a new level of automation, responsiveness, and coordination across production lines. An AGV or autonomous mobile robot can be operated at a 30% higher speed on a 5G network, due to robust handover of signals. Machines that communicate directly with each other can adjust speeds, tooling, or workflows and eliminate bottlenecks.
Materials savings of 5G implementation
Early deployments of private 5G networks have shown that cloud quality control increases testing capacity by 25%, the ABI Research study on behalf of MxD found. Higher accuracy reduces waste and translates into major materials savings.
Reduction in Maintenance
Real-time monitoring enabled by 5G can reduce downtime significantly by enabling better predictive maintenance. Machines that are monitored for temperature, vibration, and pressure allow for early detection of wear and faults. With 5G, manufacturers can use augmented reality tools to assist maintenance technicians, which could mean faster and more accurate repairs.
Security
Early adopters of 5G for manufacturing have been pleased with the security provided by a private network, according to survey research. This is due to the additional security characteristics that private cellular networks offer. A private network requires specifically designated SIM cards to grant devices access to that network, creating an additional physical layer of security. Furthermore, the deployment of a private 5G network allows all connectivity infrastructure to remain on premises.
The ABI Research cited above examined deployment of 5G wireless in automotive vehicle manufacturing, electronic goods and component manufacturing, third-party logistics and retail distribution warehousing, and found that in those four sectors, operational cost savings return on investment average a multiple of 28 times over the five-year analysis period.
Manufacturers may wish to pilot some projects before full-scale deployment of a 5G network. Examples could include a single production line or a maintenance or training area.
In the pilot project, companies can measure latency and uptime improvements and get feedback from workers. It should be clear whether the gains are measurable, and meaningful.
Cost of Inaction
Businesses also need to think holistically, and carry out not just a ROI assessment, but a cost of inaction (COI) assessment. A COI review assesses the impact of inefficiencies and downtime on processes, and can quantify opportunity costs.
After manufacturers have identified key areas where 5G could improve operations—such as machine automation, real-time monitoring, predictive maintenance, and supply chain integration—they should next try to quantify the current costs of inefficiencies. Downtime due to delayed data transmission, labor-intensive processes, maintenance overruns, or missed production targets all come with a pricetag.
Pilot project data and case studies will provide estimates of potential savings and productivity gains The final analysis should contrast projected gains from 5G implementation with the ongoing operational and strategic losses from inaction, providing companies with a compelling financial and strategic rationale for timely adoption.
Investments in information and operating technologies are often complex and unclear. But for speed, security, capacity, and savings, the deployment of a private 5G network can generate immediate benefits.
With more research and a commitment to investment, innovation, and opportunity beckon.
