Smart Cities: Not Such a Smart Early Years Investment?

Smart management of traffic and smart parking initiatives will save 4.2 billion man-hours annually by 2021, a new study by Juniper Research predicts. The issue is how such improvements can be effectively monetized, creating tangible revenue streams that supply the incentives for investment and sustainable operations long term.

Smart city revenues are expected increase by almost 14 percent in the coming years, growing to $2 trillion by 2020, research by Arthur D. Little suggests. Of course, as a practical matter, such global forecasts, amalgamating revenue from many different sources, are less relevant for actual firms operating in local markets.

Smart City revenues growth

“Today, the majority of smart city investments are flowing into smart grids, reduction of carbon emissions, public broadband (e.g. free Wi-Fi) and building automation,” says Ansgar Schlautmann, Arthur D. Little global head.

Some two million smart parking spaces will be installed globally by 2021, Juniper predicts, providing some of the quantifiable revenue upside.

Additionally, the research found that the smart street lighting market, consisting of micro-controlled LED units and sensors is expected to surge over the next five years, with over half of installed LED fixtures being networked globally by 2021.

Some reduction of municipal utility bills will provide some of the benefits. Additional sensors installed on fixtures enable new services for revenue generation, such as municipal Wi-Fi. In the early years, it hard to see how such apps can sustain the expected investment.
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