Anyone looking for the future of manufacturing might want to look in Austin.

The city is home to AT&T and Samsung's 5G Innovation Zone, a new research facility where the two telecom giants are demonstrating how the fifth-generation wireless network will change manufacturing and create smart factories that use digitized, connected machines. Inside the space, robots execute complicated manufacturing tasks in one station, while VR headsets in another reveal how workers will complete augmented reality training programs to learn new skills. Visitors to the space can not only observe the applications that might exist in the smart factories in the near future, but also test some of the equipment that workers in these facilities will one day use.

The goal is to demonstrate some of the upgrades the manufacturing industry could experience with the ultra-fast wireless network and encourage business owners to start thinking about possibilities for the future.

"Just like the LTE world gave rise to Airbnb, Waze, and the gig economy, 5G is going to give rise to an entirely new set of startups," says Mo Katibeh, the CMO of AT&T Business, the telecom company's arm for business customers​. Katibeh added that these companies will "create applications that none of us have even dreamed up yet.

AT&T Business, Samsung Electronics America, and Samsung Austin Semiconductor--the semiconductor manufacturing facility that houses the Innovation Zone--opened the space earlier this year. It's worth noting that Austin is already a hub for entrepreneurs; the city ranks No. 1 on Inc.'s list of the best places to start a business. 

Here's how 5G is expected to change the manufacturing industry in 2020 and beyond.  

1. Next-generation training

Augmented and virtual reality powered by 5G--which is faster than its predecessors--is expected to be used to train new and existing workers in skills like mechanical repairs, according to Katibeh. A 5G-enabled AR headset would allow a worker to look at an existing piece of equipment and see an overlay of instructions on how to make the repair. Employees could also videoconference a remote worker to get a consultation, creating a more effective and faster workflow, Katibeh added.

2. Safer work environments

Cameras powered by 5G and artificial intelligence could be used to enhance worker safety. As workers enter a restricted safe zone--a place where only properly dressed workers can enter--cameras could scan the area to ensure everyone has the proper gear, even preventing doors from opening if a worker isn't wearing a hardhat, Katibeh says. "If you prevent a safety issue, that kind of pays for itself a hundred times over," says Chandra Brown​, the CEO of MxD, a nonprofit in partnership with the Department of Defense that equips factories with innovative digital tools. In July, AT&T announced a collaboration with MxD's Chicago Innovation Center, which is dedicated to developing manufacturing innovation, to showcase 5G use cases and applications. 

3. Souped-up supply-chain management 

Startups may also use 5G to power better sensors and cameras that detect defects among manufactured goods. For instance, machines could find errors among prototypes, halt production, and identify what went wrong in the process at a very quick speed, Katibeh says. Early detection would reduce the time spent hunting for the problem and costs associated with accumulating unusable products. "That could mean the difference between succeeding as a startup or seeing your startup fail," Katibeh says.

While it remains to be seen how fast businesses will invest in 5G-enabled technologies, Katibeh believes that startups will be early adopters because they're more flexible than larger companies. "They can be more agile and nimble to be able to meet market needs," he says.