U.S. mid-sized manufacturers are accelerating private 5G and edge AI deployments under mounting pressure from EU NIS2 cybersecurity requirements and a broader industry push toward open operational technology (OT) standards. Industry data indicates the shift is moving decisively beyond early pilots into production-grade infrastructure.
Background
The NIS2 Directive - the EU's updated cybersecurity framework - replaces the original 2016 directive and aims to harmonize and strengthen cybersecurity obligations across 18 critical sectors, including manufacturing. Member states were required to transpose NIS2 into national law by October 17, 2024, with full compliance expected by mid-2025. While European in origin, the directive's impact extends worldwide as multinational enterprises adopt NIS2-aligned practices to strengthen their overall cybersecurity posture.
U.S. plants with EU supply chain relationships face parallel regulatory pressure. The joint CISA-FBI cybersecurity guidance issued in September 2025 carries strong parallels with NIS2; both frameworks emphasize proactive asset management, third-party accountability, and continuous risk evaluation. New regulations - including NIS2 in the EU, NIST 800-82 updates in the U.S., and the Cyber Resilience Act - are expanding compliance obligations for industrial and critical infrastructure operators.
At the same time, the open-standards ecosystem for private 5G radio access networks (RANs) is maturing rapidly. Since March 2025, O-RAN ALLIANCE Work Groups and Focus Groups have published 60 technical documents, bringing the total to 134 titles in the current version and 830 documents overall. The open interface specifications are gaining significant adoption across industry verticals, delivering interoperability, flexibility, and innovation while contributing to cost reduction, scalability, and enhanced security.
For a related look at how industrial SIM standards are addressing secure IIoT connectivity in robotics and packaging - also under NIS2 pressure - see earlier coverage: Industrial SIMs Boost Secure IIoT in Robotics, Packaging Lines.
Details
The performance case for converged private 5G and edge AI has solidified. Nokia's 2025 Industrial Digitalization Report, developed with GlobalData and drawing on insights from 115 industrial enterprises across manufacturing, energy, logistics, mining, and transportation in Australia, Germany, Japan, the United Kingdom, and the United States, found that 87% of on-premise edge and private network adopters are seeing a return on investment in just one year. 94% of industrial enterprises have deployed on-premise edge technology alongside private wireless, a combination supporting AI-driven use cases such as predictive maintenance, real-time monitoring, and digital twins in 70% of surveyed enterprises.
Security ranks as a top driver: 57% of respondents cited cybersecurity as a motivation to deploy an industrial edge platform with a private wireless network. GlobalData forecasts the global private wireless network market will nearly double to $8 billion by 2027.
The latency advantage of local processing is central to deployment decisions. Cloud-based processing typically introduces 200 milliseconds or more of latency, whereas private 5G paired with on-premise edge compute delivers approximately 10 millisecond response times, enabling decisions up to 40× faster than cloud alternatives.
Open-standards frameworks are making multi-vendor integration more tractable for operations teams. NIS2 stresses the use of international standards to ensure entities implement effective cyber risk-management measures. ISA/IEC 62443 is a key cybersecurity standard for designing secured industrial automation and control system (IACS) infrastructures, widely used in manufacturing, power utilities, and oil and gas. The NIS2 directive also envisions a European certification scheme - currently under development - for 5G and industrial infrastructures, likely to be based on or derived from ISA/IEC 62443.
OEMs and system integrators are repositioning their portfolios accordingly. Private 5G offers strong built-in protections, but security outcomes depend on governance - including identity management, SIM and eSIM lifecycle handling, OT-IT segmentation policies, and anomaly detection - all essential for maintaining consistent security in environments where 5G centralizes wireless access.
Early deployments reveal that implementation demands operational discipline. Success depends as much on radio frequency engineering, device readiness, and OT integration as on the 5G standard itself. Value stems primarily from new automation capabilities, not connectivity cost savings alone. The strongest returns come from manufacturers that used private 5G to unlock new workflows such as robotized material handling, real-time video analytics, condition monitoring, and flexible production-line reconfiguration.
The OT security threat environment adds urgency. According to the latest Clusit report, manufacturing remains among the sectors most targeted by cyberattacks. In 2025, attacks against manufacturing increased 79% compared to the previous year, with incidents classified as critical or extreme rising from 20% to 30% of the total.
Outlook
Organizations subject to NIS2 must implement all required technical and organizational measures by October 1, 2026. Analysts expect the convergence of maturing open-standards specifications, certified reference designs, and modular plug-and-produce solutions to accelerate retrofit projects at mid-sized plants that have so far relied on legacy wired OT infrastructure.
The global industrial AI market reached $43.6 billion in 2024, according to IoT Analytics, with compound annual growth projected at 23% through 2030 - when the market is expected to reach $153.9 billion. Despite growing interest and clear ROI potential, many manufacturers still struggle to move AI initiatives from isolated pilots to scalable, factory-wide solutions. Challenges stem from gaps in data readiness, organizational alignment, and evolving regulatory expectations.
