Recent research and our Digital Infrastructure webinar have more details

Eric Hanselman

Welcome to Next in Tech an S&P Global Market Intelligence podcast with the world of Emerging Tech List. I'm your host, Eric Hanselman, Chief Analyst for Technology, Media and Telecom at S&P Global Market Intelligence. And today, we're going to be talking about Smart Cities, all of the digital infrastructure, the technologies, a lot of the social changes that are taking place with my guest, Zoë Roth. Zoë welcome to the podcast.

Zoë Roth

Thanks for having me, Eric. I'm super excited to be here and be talking about all things smart cities.

Eric Hanselman

Well, a very smart subject. And actually, one we just finished a webinar, which we'll refer to in the show notes. But a lot of the things we covered, I thought were interesting insights, both in what we see in our data, but also from analyst perspective, what you've been looking at in terms of research.

I guess before we go too far down the road, the road in smart cities, it's worth really defining what are smart cities, because I think we've got a sort of a vague idea of, yes, smart cities. There's all sorts of cool capabilities the city has. But how do we define them? And can we actually identify any smart cities today? Where are we in there?

Zoë Roth

Yes, that's a great question, and I think there's a lot of issues with definitions. People have variable definitions, and for that reason, people think there aren't as many smart cities as there actually are. So the way that we define smart cities and what's been guiding our research are cities or towns or communities or tribes, they don't always have to be cities, they don't have to be urban, they can be rural towns as well that use Internet and communications technology, namely Internet of Things devices to tap into their existing data streams and turn those into actionable insights.

So whether that is instrumenting an intersection with sensors to understand how many people are coming through or maybe putting a sensor in a waste bin in a public park to only send trucks to come by just when that sensor activated its full. So to that end, there's actually a lot of smart cities the way that I see it. I don't think the bar needs to be as high as some people think there needs to be flying cars or only some of these super high-tech cities, like the one that they're building in Saudi Arabia NEOM, that's going to be a big smart city, but it doesn't have to be one of these high-tech flying cars type of cities, any city that's implemented IoT sensors to collect their data is already a smart city in our eyes here.

Eric Hanselman

So I should leave my jet pack in the garage for now.

Zoë Roth

For now.

Eric Hanselman

Well, but that's an interesting point. And I think it's one of those things that as you're identifying, people think that this has to be massive leaps forward in terms of capabilities, the flying cars kind of next stage of lots of intelligent capabilities, but it can be so basic, but yet so impactful, both in energy savings, yes, you're identifying cost management, waste pickup.

A lot of these things that are really nuts and bolts day in, day out kinds of things that can be a significant advantage for municipalities, large and small, and that's something where sometimes it can seem like that enormous task or a big step to be able to get there. But in fact, these are things that you can really accomplish on a relatively moderate scale and still see really big impact.

Zoë Roth

Yes, absolutely, and I think starting small is what a lot of cities tend to do, starting with a few pilots. So one of the most common, I think, first smart city implementations is around smart street lighting, so when a city wants to replace the bulbs in their old street lights and do LED conversions, they're kind of like, well, while we're here, we can think about what else we could use this pole for.

We can either add a lighting controller to the pole to be able to access that light remotely and turn it off and on and also drive insights on energy, but then also being able to use the pole as a site of digital infrastructure application, whether that be a WiFi access point or in some cases, 5G small cells, that's relatively immature technology right now, at least in the city space, but it is kind of these little by little incremental changes that cities are making.

And once they do start adopting individual IoT applications, they can set up kind of their data governance structure, figure out how that data is going to come into the city, who all could use it, what can it be used for? And once they get familiar with that, they're more comfortable scaling that application and then also adopting new technologies.

Eric Hanselman

Well, that incremental approach is one of those things that I think a lot of times gets missed, but you also identified digital infrastructure. And I want to dig into that a little bit in terms of what's really needed and what are the capabilities that you really have to have in place. You mentioned some of the data sharing pieces. What are the different aspects of that?

Zoë Roth

Yes. So I'd say there's 3 to 4 main pieces of digital infrastructure that I'll touch on. There's the connectivity, there's the compute and storage and then there's data exchange and visualization platforms. So for the connectivity, that can be something like cellular, WiFi, LoRaWan, LPWAN. So that just kind of underpins data from the point that it's generated to where it is processed, whether that's on the edge or if it needs to be sent to the cloud and back.

So for the adoption of cellular technologies that's pretty mature. So a lot of cities are still relying on their 4G or LTE networks to facilitate that data exchange. A few cities are already using 5G networks and kind of the value prop of 5G networks is that they can do faster data exchange, lower latency. So for emerging use cases like autonomous vehicles and other robotics, 5G networks have a lot of promise in facilitating that.

But for the most part, it's still 4G and LTE. And then on the WiFi side, cities are starting to adopt public and municipal WiFi networks. So that can be either throughout the city or places like libraries, public parks and then local IoT devices can connect to those networks and share their data as needed. So just kind of giving them the connectivity backbone to make sure that they have the ability to share their data when it's collected. And then, of course, there's the storage that's needed, whether that's on-premises.

A lot of cities are still using their servers, but there's a little bit of cloud migration that's happening as well, slowly but surely is what happens in a lot of city or government adoption of technology, and then a big piece of this, I think that sometimes is understated when people are thinking about digital infrastructure is the role of data exchange and visualization platforms.

So as valuable as this data can be, it's really only as helpful as it is easy to be interacted with. So putting it into a visualization platform that's easy to toggle around and look and say, okay, maybe next Tuesday, I want to understand how much power this light consumed or I want to see any anomalies that have been detected in the waste bins in this park making sure that, that data is really easy to interface with and use for city employees, I think, is a really important piece of making sure that the Smart City efforts are as impactful as they can be and that the data is shared across departments and not just in the department, maybe where the IoT pilot originated.

Eric Hanselman

Well, and that's something that we see in enterprises as well, right? It's that issue of having the data is good, but if it sits in silos, where only individual chunks of the organization can see it, you're not going to be able to do as much with it. You're not going to be able to leverage it in the ways you could it was more broadly available.

And that really is a fundamental digital infrastructure thing that, hey, and especially if you're a municipality, you want to get that out where the citizenry can get to it. They can do interesting things. Take a look at what's taking place. I mean we saw some of that in terms of response to the pandemic, but there's so much more that can potentially get done.

Zoë Roth

Yes, exactly. And that brings up a point of some interesting research I've been doing recently is about open data portals. So a lot of cities actually have open data portals. I would recommend anybody listening to look up your city open data portals and a lot of cities are publishing the data that they get from IoT devices, but also just like general data that their citizens might be interested in something like permits granted last month or police incidents and putting them in these open data platforms. So I think making sure that your citizens have data literacy as well can really go a long way to making them interested in these applications and kind of getting them on board as these technologies are adopted and start to scale.

Eric Hanselman

Citizen Data Scientist.

Zoë Roth

Yes, exactly.

Eric Hanselman

And if you think about the kind of things that really can help to transform cities and services, increased visibility in a lot of cases, just increased engagement so that people have an understanding of what's going on in the city, what could be better, what they could do, a lot of different potentials. I guess to that end, I mean, you were talking about some of the data that we pulled together. What do you see as capabilities for smart cities that people are identifying as important?

Zoë Roth

Yes. So I'll start with kind of just a level set from a recent survey. So last year, we asked, are you familiar with the concept of smart cities and what's your level of interest? So about 1/3 of our respondents to a U.S.-based survey said that they were familiar with the concept, but about 3/5, we're interested in living in a smart city.

So there's a disconnect right now between a few people know about it and exactly what it can do, what a smart city is, but a lot more are interested in a smart city. And they're interested in things and technologies that make their lives easier, safer and more sustainable.

So for easier, that can be something like an intelligent intersection like I mentioned earlier, that's demand responsive and can respond to traffic in real time, so you're not waiting at a red light, when nobody is coming the other way or things like optimized public transportation routing, which is done through software.

And then on the safer side, a lot of cities are using IoT for public safety and video surveillance, so they can monitor sites where there has been a lot of crime in the past and they can set up cameras and use that for investigations. There's also gunshot detection technology, which are usually placed on those lights that we were talking about earlier.

And then as far as sustainability, which has been a big topic in the enterprise, but I think for individual citizens as well, there is the introduction of electric buses and especially environmental monitoring. So a lot of air quality monitoring happening at the hyperlocal level.

So being able to access the air quality data for your block rather than if you're going on to Apple Maps right now or you can see the air quality data for your city, but obviously, that might not mean as much to you if you're on the far west end of the city and the data is being collected from maybe the capital. So those are just a few of the applications, I think that can solve for just making the quality of life better for citizens.

Eric Hanselman

And providing that visibility and understanding it really once again, what's going on in the world around them.

Zoë Roth

Yes, exactly.

Eric Hanselman

You talked about some of the traffic aspects. It seems like there's a big mobility component to a lot of this. How does that factor into the smart cities perspective more broadly?

Zoë Roth

Yes. I would say transportation and mobility applications are probably the most common IoT or digital transformation projects that cities look to undertake just because transportation is such a huge issue for cities of all sizes, whether it be congestion, air quality, just time spent and traffic. So that's an issue.

And also safety. It's a huge safety issue. A lot of cities are adopting Vision Zero plans where they aim to get 0 traffic-related fatalities in their cities. So traffic and transportation is definitely a big pain point to solve. So to that end, there has been a lot of concepts around, okay, how can we solve this and how can we use digital to solve this age-old problem of traffic. So there's been introduction of intelligent transportation systems.

So that's just bringing all of these different IoT endpoints across the transit spectrum. So from cars to roadside infrastructure and intersections and facilitating that data so that it's accessible and it can be acted upon to fully bring it together into a full intelligent transportation system that understands what's going on a mile down the road and can communicate that to vehicles or public transit vehicles, emergency responders and things like that just to be safer and have a little bit more clarity into what's happening on the road.

There's also the introduction, of course, of advanced air mobility and urban air mobility, which I know you're super excited about, and that is definitely further away than Intelligent Transportation Systems, ITS is pretty much here right now, a lot of cities have ITS plans already and they've adopted technologies to that end. But urban air mobility and advanced air mobility is going to require its own digital and physical infrastructure and that's a little bit further down the line.

Eric Hanselman

Disappointment, my eVTOL, my vertical takeoff and landing craft isn't yet going to be able to take off yet. But I guess we're getting closer. But to your point, it is part of that transition in terms of greater understanding mobility, comes from a lot of the data that's available, ensuring that you've actually got the ability to understand what the need is, what the potential is, and what could actually be leveraged and delivered.

So much of that overall mobility analysis piece is really looking at what are the needs of the community, who's trying to get from here to there? How do you manage that efficiently, and it's everything from providing transportation across the population, so being able to identify which constituencies in the population need transportation, if you're looking at senior living environments that need transportation to health care facilities, being able to go schedule and manage those kinds of things.

There are so many different pieces to this, not just the flying car parts. So if we think about what was going well into the future with my eVTOL and my jet pack there. But what do you think about in smart cities, how this is evolving and every episode, we need to bring up the role of AI. What do you think that impact is? And how do you think that's going to change how these evolve? And what is that role because, hey, doesn't everything have an AI angle these days?

Zoë Roth

Yes, that's definitely what it seems like. I would say right now in smart cities, the way we see it is smart cities are smart cities because they're using IoT, but their adoption of AI is pretty tied to their existing IoT applications. So a lot of these mobility and transit-related applications that we were just talking about have an AI analytics component where they can relay information on trends and do some prediction.

So a lot of cities are slowly starting to adopt AI just as it's baked into their existing applications. And according to some of the AI teams data, I think that about 30% of government and education, so public sector respondents said that AI or ML is in production compared to 34% in the survey average. So it's not too far behind. I think a lot of people tend to think that government is majorly lagging the private sector, but it's not lagging as much as some may think.

But as far as the Generative AI everyone is wanting to know what are the use cases? How is it going to change our business? And I think that's pretty immature as well, but some of the use cases that I've been talking to city leaders about as far as their adoption of Generative AI is looking at city or county level chat bots doing intelligent document processing, doing fraud detection and benefits administration.

So a lot of these are not super, I would say, glamorous applications. They're not like these high tech, crazy, mind-blowing Generative AI, it's going to change everything about a smart city, but I do think that it is going to free up a lot of resources in the city, which can redistribute those resources to focus on other areas in the smart city and also just make the life of city employees a lot easier.

Eric Hanselman

Well, as we see in so many first-stage GenAI applications, it's that user interface, it's the natural language processing capabilities. Who gets more questions than town government about when is trash day, when are taxes due? When is the next election? Where do I vote? What's going on with my water bill, all those kinds of things, that natural language processing piece is that user interface as long as it's got access to the data on the back end, which was your point about the data infrastructure pieces can be really productive in terms of getting people the information they need more quickly and being able to do that without expanding the number of people government needs to be able to handle it.

Zoë Roth

Yes, absolutely. And a lot of cities in the U.S. and globally have already outlined their Generative AI guidelines and policies and kind of identified the use cases and vendors that they want to work with. So it's definitely something that's already in the works, and it's not too far away.

Eric Hanselman

Interesting. So that's really an indication that there's been a fair amount of not only evaluation, but taking some of those first steps to really move into leveraging the technology.

Zoë Roth

Yes, absolutely.

Eric Hanselman

So we think about what organizations should be considering about this. I guess as enterprises are planning for the future and where they fit in this much larger role, certainly, there's a big role for the data integration pieces. There's an awful lot more in terms of being able to build out a digital infrastructure more broadly that's necessary. There are a lot of different angles in terms of what that participation in the world of smart cities is really all about.

Zoë Roth

Yes, absolutely. I think as far as what enterprises should be considering it obviously depends on the angle that they're coming at it from, whether they're a network infrastructure operator or if they're just an individual like a start-up in the IoT space, but something that's really big in smart cities is the role of community engagement and kind of facilitating a dialogue that's happening with the community.

Smart city projects in the past have failed because they didn't get that community engagement in the first place and citizens were kind of like why are you putting up these technologies? What do they do? What are you going to use them for? And that goes back to data privacy and security, if you're not having that transparent dialogue with the citizens about why you're deploying these technologies that can definitely hamper efforts to fully scale and get all the benefits that you would want from a smart city.

So then besides I feel like the community engagement, obviously, the privacy and security, making sure that the vendor that you're working with either has privacy by design principles or if you're in Europe, they're compliant with GDPR, making sure that, that level, understanding where your data is being processed, where it's being stored, who owns it.

That's something that vendors are going to have to address when they go to work with the Smart City and then also just scalability. I think a big issue with IoT in general, but especially in cities is the issue of pilot purgatory. You can deploy 10, 15 pilots in the city, but if you're not able to scale them, it's really not as impactful, obviously, as if you were able to. So from the beginning, understanding what would scale look like, what am I going to need to do with the city and with the citizens to make sure that we can reach that scale and deliver the maximum impact of this application?

Eric Hanselman

Yes. It's one of those things that you have to have a plan for what the adoption looks like and really where that's headed in terms of transitioning it. But I think the point that you made about the data privacy, all of those human concern pieces around this are, of course, big any time that we're bringing in new technologies and AI also has that big scary component to it of not a lot of great understanding.

If you can address the privacy, the regulatory pieces and communicate that understanding upfront, I mean, again, it's the same things we talked about through a lot of AI project engagement processes, but ensuring that you're actually talking to the people who are going to be affected and to do the work upfront to address the concerns as opposed to just sort of dropping them on and saying, "Hey, surprise," so often that winds up being a path to all sorts of difficulties.

Zoë Roth

Yes, that's the fun thing about public sector and citizens. When I'm talking to my colleagues who are covering nonpublic sector or government stuff, they're like, but there's the community engagement piece like what are the users going to think, like how are they going to react?

And it's definitely more unique to the public sector concern really getting that community engagement and community learning too, just explaining like, okay, what does the sensor do? What does it mean? Why are we using it? How is it going to make your life easier? So that's definitely something unique to public sector IoT deployment.

Eric Hanselman

But I'd make the case that we should be doing that no matter what the deployment is but, yes, to your point, you've got a broader population, you've got a lot more variability in terms of level of understanding, sort of like, "oh, the lights on my street are now turning off" is that because it's watching me, those sorts of things. All of those aspects are so critical to help people understand what's actually taking place.

Zoë Roth

Yes, totally.

Eric Hanselman

We've got so many examples or I guess, cautionary tales of projects get rolled back because there was a lack of understanding, there was an expectation that it was doing more than it actually was or wasn't actually delivering the benefits that it was supposed to, it’s something we see so often in tech on so many different fronts. But hopefully, cooler heads prevail.

Zoë Roth

I know I was going to say it's almost an issue just even with the term of Smart City, it's become very polarized like some people, "I don't want to live in a smart city. I don't want one of these super big brother, tech-heavy cities." But if you use like a 15-minute city, some people prefer that, and other people prefer to call it connected communities. So it's kind of like a marketing perception issue. Like what should we call these like to make people want to live in them.

Eric Hanselman

Oh, what's the 15-minute city?

Zoë Roth

The 15-minute city is just a concept where you're able to walk, I think it's either walk or drive, but I think that it's walk to basically all of the things that you would need in your daily life, so you could walk to the doctor, you could walk to the grocery store, so kind of just removing the car and transportation piece and making bike infrastructure more accessible, pedestrian infrastructure more accessible so that we're not as heavily dependent on cars, which are leading to that problem of congestion, air quality and so on.

Eric Hanselman

Getting to a point at which you can use electric transport, the ways in which there are smaller, more compact environments.

Zoë Roth

Yes.

Eric Hanselman

Well, this has been fascinating Zoë, and there's so much more that's going on. I will point our listeners towards your research. Unfortunately, we are at time for today, but thank you for all of this, and I'll point our listeners also out to the replay of the webinar and even more details we've got in there.

Zoë Roth

Yes, perfect. Thank you so much for having me. This has been great.

Eric Hanselman

That is it for this episode of Next in Tech. Thanks to our audience for staying with us.