Frost & Sullivan forecasts global smart cities to raise a market of over $2 trillion by 2025.
Smart technologies including AI, personalised healthcare, robotics, advanced driver assistance systems, distributed energy generation and another five technologies are believed to be the technological cornerstones of smart cities of the future.
These technologies are expected to drive connectivity between city departments and stakeholders in various sectors resulting in improved services, economic growth, efficiency, and urbanisation.
Frost & Sullivan predicts over 80% of the population in developed countries and over 60% for the developing world will live in cities by 2050.
This will put pressure on resources including water, energy and will require upgrades to existing infrastructure and management technologies.
Hence cities will invest in smart city technologies to optimise resources for maximum value to the population, whether that value is financial, savings in time, or improvement in quality of life.
"Artificial Intelligence (AI) has been the most funded technology innovation space in the past two years, with large investments coming from independent and corporate venture capital companies," explained Jillian Walker, Visionary Innovation Principal Consultant at Frost & Sullivan.
AI plays a key role in smart cities in the areas of smart parking, smart mobility, the smart grid, adaptive signal control, waste management.
Frosts & Sullivan anticipates:
- The Asia-Pacific region to be the fastest-growing region in the smart energy space by 2025.
- China will have more than 50% of smart cities in Asia and smart city projects to generate $320 billion for China'seconomy 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. 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," added Vijay Narayanan, Visionary Innovation Senior Research Analyst at Frost & Sullivan