Smart City has been a buzzword for years now, but with technologies such as data analytics, artificial intelligence and internet of things coming into play, we now see the term metamorphose to a ‘Hyperconnected city’. As per an Oracle-sponsored study by ESI ThoughtLab, these new Hyperconnected cities aim to not only create new business opportunities, but also lead to increased efficiency in government processes, and improvement in public safety and health. The reports highlights that these benefits will be accompanied with noticeable return on investment (RoI), which is set to magnify with increasing connectivity.
Surprisingly, despite their huge investments in technology, these hyperconnected cities remain unprepared to face any cyber attacks. The current report is an extension to the report titled “Smarter Cities 2025: Building a Sustainable Business and Financing Plan” , released last year, which covered smart city initiatives of 135 municipalities in 55 countries. It covered views of city leaders, businesses and citizens, incorporated data from secondary sources, and tapped third-party experts for analysis.
In the new report “Building a Hyperconnected City”, the focus has been narrowed down to 100 cities including cities like Athens, Warsaw, Bratislava, and Washington DC. These cities have spent close to $141 billion on various connectivity projects in 2019, which turns out to be $1,220 per citizen. With population ranging from less than 2,00,000 to more than 24 million, one-third of these cities are in developing countries. Further, these were categorized as: implementers (25 cities), advancers (50), and leaders (25).
The first report emphasizes upon the importance of data – acquiring, aggregating and analyzing as much data as possible from every possible source using a sophisticated data management platform. It also established the need to leverage modern technologies such as cloud computing, mobile applications, and IoT sensors and networks. A large section (the respondents with about 57 per cent) said that they tap non-government sources for data, which include businesses, academia, and social media. This percentage rises to 80 per cent for “leader” cities, while almost 76 per cent of these leaders consider their cities as “advanced” in collecting data and in culling out actionable insights from them. However, 68 per cent of the respondents use a data management system to integrate the data.
The growing importance of data analysis is also reflected among the key findings of the new research. The report shows that the connected cities analyzed data to secure insights into IT infrastructure (64 per cent), payment and financial systems (56 per cent), mobility and transportation systems (49 per cent), and physical and digital security (46 per cent). A whopping 90 per cent of these cities use cloud, Wi-Fi, and mobile technologies, while another significant chunk (82 per cent) saw extensive use of AI tools, especially in connection with public safety and governance initiatives. Another technology that has witnessed increased usage is IoT, with widespread usage being reported by 91 per cent of cities and this percentage is predicted to touch 97 per cent in the next three years.
When we talk about RoI, the new study shows that the cities reported an average return in the range of 3 per cent and 4 per cent, though the ‘leaders’ reported the average RoI of 5 per cent. The discrepancy was also been reported in specific municipal efforts, for example, leaders reported ROI of 7.1 per cent from digital tax filling systems, whereas the complied average RoI was 5.2 per cent.
Digital public transit applications are among the most often used and popular connectivity projects. Interestingly, 36 per cent of cities that had deployed modern public transit applications reported increased customer satisfaction. Similarly, 40 per cent of cities reported improved public health after the deployment of water related systems.
The report witnessed that the ability to generate ROI estimates helped 68 per cent of cities to create detailed business cases for all their smart city projects and 64 per cent of cities are now already working on demonstrating a positive ROI before working on such projects. Clearly, these figures show the critical importance of data and analytics in smart city projects.
The study also indicated caution against cyber attacks, skill gaps and privacy and regulatory issues. The fact that less than half of the countries surveyed considered themselves “well prepared” to face such attacks, shows that the cities have a realization of increasing vulnerability as they become more connected. Last year, municipal bodies reported loss worth $3.4 million and this amount has increased to $10 million this year. Leader cities have pegged the loss amount at $6.2 million. Majority of these cities (82 per cent) are planning to increase their budgets for cybersecurity.
Talent shortage is another big challenge faced by smart cities. Only 46 per cent of these 100 cities felt that their workforce had the requisite skills in areas such as data analytics, strategic thinking, and problem-solving to advance their projects. In fact, there are several questions raised on data quality and veracity of sources being used to collect data. Further, bio metrics and automation are making ways into our personal and professional lives. Almost half of the cities surveyed said that regulatory measures can take a toll on their ability to gather and analyze data.
-By Debapriya Nandan, Head – Public Sector, Oracle India
That said, Municipal agencies are likely to increase the spending on hyper-connectivity initiatives. As per the study this increase will be up to 14 per cent, while implementers will be increasing their investments by almost 21 per cent. Public transport and traffic will get the most investments, with public safety and public health following.
Blockchain technology appears to be the most chosen emerging technology, as two-thirds of cities are already investing in it. This investment is set to increase over the next three years with the technology finding its place in areas of governance, funding, construction and maintenance. Other than Blockchain, cities also showed interest in 5G mobile networks, robots, drones, and augmented reality.
Last year, the study revealed a disconnect between the authorities and citizens and businesses in terms of perceived challenges. As per the new study, this gap is narrowing down. Fifty two per cent of cities surveyed are enjoying support from their citizens and other stakeholders. Almost a third of the leaders have appointed ‘a chief citizen experience officer’ – responsible for maintaining clear communication with the citizens via all modern communication modes.
While authorities employ various efforts to improve the outcomes of the hyperconnected world that are building, successful hyper-connected smart cities will optimize their relationships with businesses, improve interactions with citizens, and ultimately elevate their constituents’ quality of life.