New Smart Cities Deployment Paradigms to Unlock Short-Term Value

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By Dominique Bonte | 1Q 2017 | IN-4480

At Mobile Word Congress (MWC) 2017, held in Barcelona, smart cities were a major topic of discussion. With a dedicated seminar, multiple presentations, and panel sessions, as well as vendors across the show floor highlighting the smart cities segment, this was a major opportunity for mobile and IoT technology deployments. While smart cities has been a topic at MWC for many years, this year, new ideas and approaches for accelerating deployments and achieving faster return on investment (ROI) were discussed and proposed for the first time.

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Message from MWC 2017: Decade Old Smart Cities Approaches Are Ripe for Disruption

NEWS


At Mobile Word Congress (MWC) 2017, held in Barcelona, smart cities were a major topic of discussion. With a dedicated seminar, multiple presentations, and panel sessions, as well as vendors across the show floor highlighting the smart cities segment, this was a major opportunity for mobile and IoT technology deployments. While smart cities has been a topic at MWC for many years, this year, new ideas and approaches for accelerating deployments and achieving faster return on investment (ROI) were discussed and proposed for the first time.

New smart cities concepts and visions seem to be taking root more widely, such as increased awareness regarding holistic approaches and the (re)use of platforms for as many applications as possible. Smart streetlights and smart bin technology can double as public Wi-Fi hotspots and small cells, and LED streetlights can also be used for emergency signaling and security communication through flashing, warning drivers about nearby emergency vehicles (GigaTera). Moreover, the need for replication of harmonized approaches across cities was also highlighted. All this is clearly aimed at breaking through the fragmentation barrier that holds back investments through a lack of a clear return on investment perspective. 

Sharing Economy, Mobile Sensors, and Holistic Approaches

IMPACT


While deploying dedicated smart cities infrastructure offers the widest scope for offering a wide range of reliable services, CAPEX investments are almost always prohibitive. Smarter approaches leveraging existing but underutilized assets and reusing technologies for multiple applications and use cases are needed to accelerate deployments at limited cost. Three main paradigms are instrumental in achieving this outcome:

  • Sharing Economy - One of the main challenges cities are facing is to reliably address the fluctuating demand for services such as mobility, energy, and communication. Leveraging underutilized assets often owned by consumers allows balancing demand with supply easier and at a lower cost, avoiding over-dimensioning utility, transportation, and communication networks. Examples include ridesharing, peer-to-peer car sharing, carpooling, sharing of home EV charging stations and parking spots, EVs, and home micro grids connected to fixed grids, as well as the sharing of personal Wi-Fi networks. Moreover, incentives based on dynamic pricing such as Uber Surge allow flexible adjusting supply to fluctuating demand. Stimulating the sharing economy and putting the necessary regulatory frameworks in place should be an absolute priority for any smart city program. 
  • Mobile Sensors - Many players within the IoT industry are actively promoting embedding fixed sensors into physical city infrastructure such as roads, parking spaces, bins, traffic lights, and other street furniture. However, mobile sensors in an increasing number of smartphones and connected vehicles can also be leveraged at a very low incremental cost to provide real-time information services for street-side parking spaces, traffic, the occurrence of potholes, or generally warning citizens about problems or issues, while at the same time alerting city governments about malfunctioning services. While in many cases mobile sensors ultimately are complementing and not replacing embedded sensors, they do allow kickstarting smart city approaches at very low initial investment levels.
  • Holistic Approaches - Smart cities projects need to transcend the confines of technologies and verticals and look at infrastructure more holistically whereby every piece of street furniture supports a multitude of services as part of a wider platform approach. 

Funding, Funding, Funding!

COMMENTARY


Interestingly, the new deployment strategies highlighted above eases the formidable smart cities funding challenge. Smart city financing sources recently became more accessible, for example, through interest of venture capital (VC) companies in the growing GovTech sector in the U.S. or smart city budgets made available by governments, both national (China) and international (EU). Nevertheless, funding remains largely limited, forcing smart city projects to embrace smart financing, maximizing ROI by investing in the incremental approaches mentioned above, hereby demonstrating short ROI periods, which is critical to raise further rounds of financing. Some elements of smart financing can include suppliers offering their solutions as recurring costs only (CAPEX/OPEX conversion) and the adoption of a collaborative economy made possible through technologies like blockchain.

When all is said and done, smart cities are as much about smart financing as they are about smart technology. The inherent public nature of smart city projects—whether they are embedded in public-private partnerships or not—mandates the wisest use of resources and the highest standards of accountability. 

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