The number of smart cities worldwide will quadruple by 2025, says a new report from IHS Technology.
The research agency estimates that there will be at least 88 smart cities all over the world by 2025, up from 21 in 2013.
Asia-Pacific will account for 32 smart cities of the total in nine years’ time; Europe will have 31; and the Americas will contribute 25, IHS said.
Smart cities defined by IHS are characterized by an integration of information, communications and technology (ICT) solutions across three or more different functional areas of a city including mobile and transport, energy and sustainability, physical infrastructure, governance, and safety and security.
City projects in the Americas are typically somewhat narrower in scope than those found in Europe, the report said. Unlike broad projects underway in cities like Vienna or Amsterdam, U.S. projects will often focus on a single functional area, such as mobility and transport.
Another interesting findign of the survey is that many of the budget issues facing government expenditures in the well-developed economies of Europe are not found to the same extent in the Asia-Pacific region. This is driving the scope for investment in the region.
Smart cities are gaining popularity as they can deal with issues such as congestion and energy waste, while also allocating stressed resources more efficiently and helping to improve quality of life. They can help cities achieve energy-efficient targets. Smart cities also use sensors to manage water use or provide critical information on water-storage levels.
Additionally smart cities can also generate new employment opportunities through creation of projects, prevent citizens from moving away by improving quality of life within their jurisdictions, and reduce costs.
IHS says smart city investments need to be assessed as not just direct revenue-generating opportunity but also the broader return on investment as this has implications for both the public and private sectors collaborating on smart city projects.
Because cities continue to face budget constraints, quantifying the level of cost reduction that can come about must be a top priority. Here the obvious effects of cost savings and other benefits can be measured, the report said.