According to Ericsson, businesses recognise the potential of AI combined with 5G, but implementing these technologies has become a significant challenge.
Complex rollouts and a severe shortage of skilled personnel are the main stumbling blocks. While leaders understand that reliable connectivity is essential to remain competitive, complications around deployment and coordination are preventing many organisations from fully embracing innovation.
Ericsson’s State of Enterprise Connectivity Europe 2025 report, which surveyed over 2,500 technology leaders across the UK, Germany, France, Italy and the Netherlands, highlights a gap between the promise of AI and 5G working together and the current reality of aligning the two.
A striking 88% of businesses agree that a new era of connectivity is needed to unlock innovation with AI and IoT. Ericsson emphasises that the technologies are naturally complementary: 5G supplies the low-latency, high-throughput network required for advanced AI applications, while AI can automate management and optimization of the network itself. Indeed, 85% of respondents believe AI improves network performance by automating complex analyses and reducing manual workload for IT teams.
Despite broad recognition of that potential, actual progress remains uneven. Paul McHugh, head of sales for Ericsson Enterprise Wireless Solutions in the region, notes that many companies still rely on legacy systems that cannot accommodate next-generation technology, particularly in an uncertain economic climate. The report also warns that Europe is falling short of its 2030 5G targets and is investing less aggressively than other global regions.
This underinvestment has real consequences for business innovation. Ericsson finds that the lack of coordinated 5G deployment is slowing adoption and undermining the benefits AI could deliver.
Two-thirds (67%) of firms feel that current telecom-centric solutions are too complex and are holding back their 5G progress. Upgrading infrastructure is perceived as too difficult by 38% of respondents, which stops them from moving forward, and 36% say they don’t have the necessary in-house skills to manage the transition.
Fragile connectivity is already affecting the bottom line: 46% of companies report higher operational costs as a result, 31% cite increased waste, and 28% link poor connectivity directly to lost revenue.
UK firms bet on 5G more than AI
In contrast to parts of mainland Europe, the UK appears more optimistic and proactive. British businesses are notably more convinced of 5G’s strategic importance for keeping the country at the forefront of technology and industry.
Some 69% of UK firms view investment in 5G as the best move they can make over the next 12 months to preserve the UK’s status as a leading tech nation, placing 5G ahead of AI and automation as an immediate priority according to Ericsson’s findings.
This confidence is grounded in practical expectations about cellular technology. Sixty-two percent of UK businesses believe 5G will give them greater control over scaling operations, and 61% expect improved oversight of critical processes. Overall, 92% of UK leaders say a new era of connectivity will unlock business innovation—an outlook more positive than the European average.
The UK’s push for 5G extends beyond private enterprise; it also aims to address public service challenges and support climate goals. With growing pressure to reduce carbon emissions, businesses are turning to technology for efficiencies. Ericsson reports that 46% of companies have already introduced AI or machine learning to reduce waste—an initiative that depends on dependable connectivity such as 5G.
Concerns in mainland Europe
Mainland Europe paints a more mixed picture. In Germany, there is concern that digital progress has stagnated.
The report finds that 46% of German businesses think the country is lagging behind other leading nations in digital infrastructure. This perception is reflected in rising costs: 45% of German firms reported higher operational costs this year due to unreliable connections, up from 35% in 2024.
Although 82% of German companies agree that “5G is critical to optimising the use of AI in the workplace,” many feel trapped by high rollout costs and a lack of skilled staff.
France offers another nuanced example. While 5G coverage looks strong on paper, businesses still experience unreliable connections; 39% report increased costs tied to connectivity issues. For those French organisations that have adopted 5G, improved security is a notable benefit: 45% cite enhanced control over security measures as a major reason to choose 5G over traditional fibre networks.
Taken together, the report makes clear that Europe needs a more coordinated and comprehensive strategy for connectivity. The suggested path forward is greater collaboration between businesses, governments and industry stakeholders to establish a solid connectivity foundation. With that base in place, organisations will be better positioned to create agile, resilient and adaptable operations suited to modern demands.
(Image by Rupert Kittinger-Sereinig)
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