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Smart Cities, 2022 Update – Thematic Research

The smart cities market size was valued at $221.1 billion in 2019. The market is expected to grow at a CAGR of more than 11% during the forecast period. Smart metering was the largest segment of the entire smart cities market in 2020 while the markets for smart buildings, environmental monitoring, and healthcare are smaller and are growing relatively slowly.

By 2050, nearly 70% of the world’s population will live in cities, compared to 50% today. Increased urbanization is already causing infrastructure headaches for cities, which will only worsen. These challenges are driving the creation of smart cities.

Smart cities market overview

Smart cities market overview

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What are the market dynamics of smart cities industry?

Cities will be severely impacted by climate change. A survey of 1,000 cities by the Carbon Disclosure Project (CDP) found that more than 90% of the cities will face significant climate hazards that can put people and infrastructure at risk. Climate-related threats to cities include floods, severe heatwaves, and diminishing water sources. City digital twins will prove invaluable for limiting carbon emissions and simulating (and preparing for) climate disasters. Smart water metering and leakage detection technologies will become essential as water supplies diminish and urban demand grows.

Cities will need to become smart when using both existing and new technologies, such as the Internet of Things (IoT) and artificial intelligence (AI). Effective analysis of smart city data offers the prospect of automated infrastructure, where a city can use its data to benefit its people and keep them safe.  AI, for example, will help to find more efficient ways of allocating energy, improving the efficiency of water pipes, sewage, and utilities, and monitoring them to predict and reduce maintenance requirements. It can also be applied to the flow of transport and people and provide planning controls and transportation routes to reduce CO2 emissions.

What is the city-level outlook of smart cities?

The cities that have taken a leadership role in the drive to become smart are Amsterdam, Berlin, Copenhagen, Hong Kong, London, New York, Paris, Reykjavik, Singapore, Taipei, and Tokyo.

Smart cities market, by cities

Smart cities market, by cities

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What are the key trends that will shape the smart city themes in the future?

The key trends shaping the smart city’s theme over the next 12 to 24 months can be divided into three categories: technology trends, macroeconomic trends, and regulatory trends.

Technology trends

The main technology trends that will impact the smart city theme are the metaverse, cyber threats, digital twins, AI adoption, 5G, surveillance tech, and digitalization.

Macroeconomic trends

The main macroeconomic trends that will impact the smart city theme are the post-COVID smart city, water shortages, smart city geopolitics, and the digital silk road.

Regulatory trends

The main regulatory trends that will impact the smart city theme are COP26 impact on cities and emerging tech charters.

What are the different value chains of smart cities?

The value chain of smart cities can be divided into three segments: smart city platforms, smart city apps, and smart city services.

Smart city platforms

Smart city platforms provide a platform for the unified delivery of local public services. Although each city is unique and all have its challenges around delivering services and providing vital infrastructure, a common factor is that more value will be delivered by integrating each smart city service in an all-encompassing platform. This allows for the creation of open data services to encourage innovation and the development of new digital services. It also supports the sharing of vital information to improve each constituent part of the smart city.

Smart city apps

Smart city applications can be further segmented into smart buildings, smart transport, smart infrastructure, and smart grid. Health measures in the form of improved heating, ventilation, air conditioning (HVAC), and screening systems are the crucial components of smart buildings. There cannot be a smart city without smart mobility, and smart mobility is impossible without smart transport infrastructure. The cities have also invested in two infrastructure types: health infrastructure that directly tackles the spread of COVID-19 and infrastructure that improves citizens’ digital access. Moreover, a smart grid modernizes power systems through self-healing designs, automation, remote monitoring and control, and the establishment of microgrids.

Smart city services

Cities do not have the design, technical, integration, or data analysis skills to become smart cities on their own. There is an active market for smart city design and integration services, which stitch together applications for smart buildings, transportation, infrastructure, and power grids. On the integration side, the providers of these services include large players such as IBM, Siemens, and Huawei, together with the likes of TCS, Capgemini, Wipro, and notably in Asia, Mitac.

Smart cities market, by value chain

Smart cities market, by value chain

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Which are the key public companies associated with the smart cities theme?

The key public companies that are associated with the smart cities theme are Accenture, Alibaba, Cisco, Hikvision, Hitachi, Honeywell, IBM, iFlytek, Johnson Controls, Microsoft, Nokia, Schneider Electric, Siemens, and ZTE.

Smart cities market, by public companies

Smart cities market, by public companies

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Which are the key private companies associated with the smart cities theme?

The key private companies that are associated with the smart cities theme are 75F, Cleverciti, Huawei, Quantela, and Via Transportation.

Smart cities market, by private companies

Smart cities market, by private companies

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Market report scope

Market size $221.1 billion
CAGR >11%
Forecast period 2019-2025
Key cities Amsterdam, Berlin, Copenhagen, Hong Kong, London, New York, Paris, Reykjavik, Singapore, Taipei, and Tokyo
Key trends Technology Trends, Macroeconomic Trends, and Regulatory Trends
Value chain Smart City Platforms, Smart City Apps, and Smart City Services
Key public companies Accenture, Alibaba, Cisco, Hikvision, Hitachi, Honeywell, IBM, iFlytek, Johnson Controls, Microsoft, Nokia, Schneider Electric, Siemens, and ZTE
Key private companies 75F, Cleverciti, Huawei, Quantela, and Via Transportation

Scope

This report provides an overview of the smart cities theme.

  • It identifies the key trends impacting the growth of the theme over the next 12 to 24 months, split into three categories: technology trends, macroeconomic trends, and regulatory trends.
  • It includes comprehensive industry analysis, including forecasts for global smart cities spending to 2025.
  • It contains details of M&A deals driven by the smart cities theme, and a timeline highlighting milestones in the development of smart cities.
  • The detailed value chain illustrates how smart cities fit into the IoT technology stack. The report covers three layers of the smart cities value chain: the platform layer, the app layer, and the services layer.

Reasons to Buy

The smart city is an important market that attracts substantial investment. This report is a clear and insightful overview of this increasingly important theme, telling you everything you need to know about what makes a city smart and which companies are benefitting from increased urbanization.

Key Players

IBM

ABB

Accenture

Alibaba

Amazon

Arup

Carrier

Cisco

Cubic

Ericsson

GE

Google

Hitachi

Honeywell

Huawei

IBI

Itron

Johnson Controls

Kapsch TrafficCom

Klaus Multiparking

Landis+Gyr

Lyft

McKinsey

Microsoft

Oracle

Schneider Electric

Siemens

Thales

Uber

Valeo

Veolia

Xylem

Table of Contents

Executive summary

Players

Technology Briefing

Trends

Industry Analysis

Value Chain

Companies

Smart Cities

Sector Scorecards

Glossary

Further Reading

Thematic Research Methodology

Frequently Asked Questions

The smart cities market size was valued at $221.1 billion in 2019.

 

 

 

 

The smart cities market is expected to grow at a CAGR of more than 11% during the forecast period.

The cities that have taken a leadership role in the drive to become smart are Amsterdam, Berlin, Copenhagen, Hong Kong, London, New York, Paris, Reykjavik, Singapore, Taipei, and Tokyo.

The key trends shaping the smart city themes over the next 12 to 24 months can be divided into three categories: technology trends, macroeconomic trends, and regulatory trends.

The value chain of smart cities can be divided into three segments: smart city platforms, smart city apps, and smart city services.

 

 

 

 

The key public companies that are associated with the smart cities theme are Accenture, Alibaba, Cisco, Hikvision, Hitachi, Honeywell, IBM, iFlytek, Johnson Controls, Microsoft, Nokia, Schneider Electric, Siemens, and ZTE.

The key private companies that are associated with the smart cities theme are 75F, Cleverciti, Huawei, Quantela, and Via Transportation.

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