The Connected Life deals with interesting business issues and opportunities facing the Communication and High Tech industries today and in the future. My postings share well informed, researched and structured analysis from my extensive experience in working on these issues with leading digital companies around the world.
Tuesday, August 5, 2014
How To Make Money From Smart Cities
As cities around the world grow in
size, we are beginning to see that strained resources, infrastructure, and
services are causing natural limits to urban growth, which in turn limits the
economic growth opportunity. To combat
this, cities as diverse as Barcelona, Nice, Kansas City and Songdo in South
Korea, are starting to leverage advanced technologies and data analysis to
create smart, connected cities.These
cities, and others around the globe, are building out new digital services such
as smart lighting, traffic, waste management and data analytics to reduce
costs, tap new sources of revenue, create new innovation business districts and
improve the overall quality of urban life.
Not only will the creation of smart
cities generate huge value for the cities and their inhabitants, but great
opportunities will also exist for the vendors and partners who help to create
and operate these digitally smart cities of the future.However, the question is where and how can
partners such as infrastructure providers, technology and services companies,
and communication providers participate?And, what types of revenues can they generate from helping to create
Based on our extensive experience in
creating and supporting smart cities around the world, Cisco has identified a
number of essential ingredients required to deliver and run a successful smart
city.The Cisco Smart City Business
Architecture categorizes a set of requirements in a number of different business
layers, with each layer supporting the layer above and increasing the potential
business return as we move up the stack.
Starting from the
bottom, the layers comprise:
connecting all of the solutions, data and applications through fiber backhaul
or licensed cellular.
Access – a managed Wi-Fi,
or other unlicensed wireless network, to connect all of the sensors and
Platform – a platform
to allow new devices and solutions to readily and securely “plug and play” into
the overall architecture, and to connect to cloud storage and compute services.
City Solutions – the
combination of devices and applications that deliver the specific solutions,
such as smart lighting, parking and traffic management.
Monetization – opportunities
to leverage the platform and network create new sources of revenue in areas
such as advertising, data analytics and subscriptions
Operating Platform –
a shared platform to consolidate the management, customer care and service
issues across all of the solutions.
Services – services
to support areas such as systems integration, planning and design.
Leadership – services
to program manage the entire implementation, operations and partner ecosystem
of the smart city initiative.
Cities will need vendors
and partners to provide solutions and services in each of the different layers
of the business architecture to make their smart city initiatives a
success.Future blogs will explore how
much revenue is available in each of the layers of the business architecture
and how providers can best capture it.