City populations are growing rapidly in the United States and around the world. Migration from the suburbs and rural communities to metropolitan areas is being fueled by the promise of cultural experience and diversity, education, good jobs and higher standards of living. Indeed, we’ve now passed the point globally where more people are living in urban rather than rural environments. This trend has presented new challenges to today’s city planners, managers, politicians and officials, and they’re turning to technology and big data to meet the increasing demand for more responsive, efficient city services and public resources. The “Smart Cities” movement is rapidly on the rise.
Cities mirroring the success of data agility in private enterprise
Forward-thinking city officials, driven by these pressures, are taking a page from the private sector playbook having learned that in the business world (see Provost & Fawcett, “Big Data” 2013) companies that effectively use data to drive decisions outperform competitors by a 5-6 percent margin. In addition to these promising efficiencies for cities, the level and new scope of services that can be harnessed for cities through a constant, dynamic flow of data from multiple sources is mind-boggling.
The optimally connected smart city has the potential to incorporate web analytics, social media, mobile data, buildings data, video, motion sensor and security camera feeds, power and water utilities smart grid data, traffic systems data, emergency, police and fire supervisory control and surveillance systems and other technologies. By taking these source objects that receive, collect and transmit data and organizing their real-time feeds into collaborative, situational-awareness decision-making tools and dashboards, public agencies can make better informed policy and investment decisions, emergency responders and law enforcement can react more quickly to protect the public, and citizens can get access to information they need, when they need it. This data-driven innovation is solving an array of municipal challenges that will vastly improve the quality of life for city-dwellers.
Private-sector collaboration a growth factor
Cities are not alone in their quest to improve the quality of life for an expanding population. They are getting some help from the commercial economy where disrupting old models to the benefit of the smart city is proving to be just good business. The Kleiner-Perkins 2018 Internet Trends report recently pointed to the Shared Mobility Principles for Livable Cities pledge signed by Uber and 14 shared-mobility providers, an intent to eliminate the need to have a personal car in the city. And it seems to be working. The report highlighted that it’s now more economically viable to commute via Uber than personal vehicle in five major US cities; New York, Chicago, Washington, Los Angeles and Dallas. We can expect to see more private sector innovations like this contributing and connecting to Smart Cities networks and initiatives when the value to the city, and the consumer, are accompanied by viable, responsible and sustainable business models.
To enable effective data collection, integration and analysis for large municipalities, major technology providers have committed to deliver solutions specifically created for smart city operations centers and data management. They see winning in this market a significant opportunity as well as a competitive differentiator. IBM, Cisco, Microsoft, Siemens, Hitachi, SAP and Oracle are a few of the larger global providers investing significantly in this market. New tools support advanced analytics, real-time key performance indicators, instant messaging for field operators, geospatial mapping, web service interfacing and other proprietary features for city administrators.
Personal privacy, cybersecurity concerns remain
We’re fast learning as a society that “connected, open and convenient” is accompanied by some major trade-offs, particularly when it comes to protecting personally identifiable information (PII) and threats of cyberterrorism. Smart Cities will have to make sure their policies do not abuse or expose without permission what they might learn about citizens through their interactions with the city network infrastructure – whether it’s from a known and transparent transaction, or from “incidental” monitoring such as the swipe of a subway card, use of city Wi-Fi, geolocation tracking on smartphones, or even an apartment’s utility data. The EU’s new General Data Protection Regulation (GDPR) of 2018 is a positive sign, and probably the first of many such regulations that will be considered to stem the tide of PII abuses. Cyberattacks in the form of malware and ransomware are already invading many municipal systems, and the risk of a broader cyberterrorism attack on police, fire, utility or other critical systems infrastructure cannot be underestimated, and likewise need to be addressed with robust security measures – or the great promise of Smart Cities could well lead to disaster.
Opportunities abound in the Smart Cities market
As big data innovation shapes the future of our modern cities, businesses and firms that serve municipalities and participate within urban ecosystems should be thinking about the implications and opportunities arising from urban growth, including emerging competition, potential disruption – and, importantly, data integration. Firms, suppliers and the professionals involved in designing, building and maintaining our urban environments are in a unique position to be thinking about how they can leverage expertise and data to fuel and enable Smart Cities initiatives.
A recent study pegged the global market size for Smart Cities infrastructure and services to be $1.5 trillion by 2020. (Frost & Sullivan, “Next decade’s mega trends (and what they portend for cities)” http://smartcitiescouncil.com). Given the advances and recent momentum, the Smart Cities global market opportunity could now be even larger. As a result, “smart companies” are increasingly honing their “smart city” strategies as a critical business development priority.