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With over 80% of the population in developed countries expected to live in cities by 2050 – and over 60% in developing countries – the creation of smart cities will enable a smooth transition to urbanization, say Frost & Sullivan analysts. Technological advances associated with smart cities help municipalities optimize resources for maximum value to the population in terms of financial, time savings, and quality of life improvements.

A key technology for the creation of smart cities, says the firm, is artificial intelligence (AI) technology. “Artificial intelligence has been the most funded technology innovation space in the past two years,” says Jillian Walker, Visionary Innovation Principal Consultant at Frost & Sullivan, “with large investments coming from independent and corporate venture capital companies.

In terms of smart cities, AI plays a key role in the areas of smart parking, smart mobility, the smart grid, adaptive signal control, and waste management. Major technology companies like Google, IBM, and Microsoft remain key tech innovators and the primary drivers of AI adoption, the firm says.

Other key findings include:

  • Smart cities are expected to create huge business opportunities with a market value of over $2 trillion by 2025.
  • AI, personalized healthcare, robotics, advanced driver assistance systems (ADAS), distributed energy generation, and other five technologies are believed to be the technological cornerstones of smart cities of the future.
  • The Asia-Pacific region is anticipated to be the fastest growing region in the smart energy space by 2025.
  • In Asia, more than 50% of smart cities will be in China. Smart city projects will generate $320 billion for China’s economy by 2025.
  • North America (NA) has been quickly catching up, with many Tier II cities – such as Denver and Portland – committed to building their smart city portfolios.
  • The total NA smart buildings market, comprising the total value of smart sensors, systems, hardware, controls, and software sold, is projected to reach $5.74 billion in 2020.
  • Europe will have the largest number of smart city project investments globally, given the engagement that the European Commission has shown in developing these initiatives.
  • The European e-hailing market, central to cities developing smart mobility solutions, currently generates revenues of $50 billion and is estimated to reach $120 billion by 2025.
  • In Latin America, cities actively developing smart city initiatives include Mexico City, Guadalajara, Bogotá, Santiago, Buenos Aires, and Rio de Janeiro. In Brazil, smart city projects will drive almost 20% of the overall $3.2 billion IoT revenue by 2021.

“Currently most smart city models provide solutions in silos and are not interconnected,” says Vijay Narayanan, Visionary Innovation Senior Research Analyst at Frost & Sullivan. “The future is moving toward integrated solutions that connect all verticals within a single platform. IoT is already paving the way to allow for such solutions.”

For more from the firm, see “Smart Cities: Discover Opportunities of the Future.”

Related articles:
IoT smart cities market to be $147.51B by 2020, says report
Bill Gates invests $80M to create smart city in Arizona Intel-sponsored study on smart cities focuses on citizen benefits
Automotive tier ones discover the Smart City
Sidewalk Labs to build ‘smart neighborhood’ in Toronto

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