Despite criticism, smart-city technologies take off

Smart city technologies will generate more than $117 billion within the next seven years and will account for $20.2 billion in annual sales in 2020, up from $6.1 billion in 2012, according to Navigant Research. But not all observers see such spending as a good investment. Alec Appelbaum, in a New York Times article titled “Techs and the City,” writes, “…higher tech is not always essential tech.”

Navigant Research points to factors driving smart-city spending. For example, between 2010 and 2050, the number of people living in cities will increase from 3.6 billion to 6.3 billion. In addition, 37 megacities, each having a population greater than 10 million, will exist by 2025.

A recent Navigant report on smart cities targets IT companies, networking and telecommunications vendors, smart-grid hardware and software vendors, smart-transport providers, energy-management hardware and software vendors, and building-equipment and appliance vendors, as well as real-estate developers, urban planners, governments, and investors. It compares smart-city approaches in North America, Europe, Asia-Pacific, and the Middle East, forecasting the size and growth of the smart-city technologies in each region through 2020. It defines smart cities, cites market drivers and barriers, describes key players, and comments on policy, technology, and economic issues.

The firm notes, “Trillions of dollars will be spent on urban infrastructure…presenting an immense opportunity for new transport management systems, smart grids, water monitoring systems, and energy efficient buildings. Information and communication technologies will be deeply embedded in the fabric of both old and new cities and will change the way we think of city operations and how we live and work in these environments.”

So what's not to like about smart-city technologies? Appelbaum, in his Times article, says that instead of buying ever more complicated technology, “Cities could instead be making savvier investments in cheaper technology that may work better to stoke civic involvement than the more complicated, expensive products being peddled by information-technology developers.”

Appelbaum does not seem fond of the technology developers. He continues, “Of course, you’d never hear such an idea from the likes of IBM, which has plastered airports with ads about how its consultants help municipalities cut costs with its 'Smarter Cities' analytics platform, or Cisco, which has teamed with Toyota and other companies to sponsor annual conferences about how to automate cars and gather information on urban activity through streetlight-mounted sensors.”

These are bad things?

Appelbaum's main complaint seems to be “the eye-popping price tags” of smart-city technology, yet he presents no examples of smart-city implementations whose costs outweigh their benefits. And he seems to think city leaders will be unduly swayed by airport advertising campaigns.

It's to be expected that vendors will present their smart-city wares in the best possible light, aggressively push them, and try to command high prices. And city leaders need to be skeptical of claims and seek out optimum price/performance implementations—not fall for the first pitch they hear. And that seems to be happening.

As Navigant research director Eric Woods said in February, the smart-city-technology market had been shaped largely by technology suppliers, but that began changing in early 2012. “Today,” Woods said, “the market is being driven by the enthusiasm of city leaders. Mayors and other city executives have seized on the smart-city concept as a rallying point for the technological, commercial, and social innovation needed to meet the challenges and opportunities facing their communities.”

As I mentioned, Appelbaum doesn't present any examples of overpriced smart-city implementations. All he does is cite two examples where low-tech approached worked: San Francisco CIO Jay Nath convened an unhackathon—an in-person meeting—to retool the city's taxi-dispatch systems, and high- and low-income residents in Appelbaum's Lower Manhattan neighborhood resolved tensions over redevelopment of a vacant site using old-fashioned email. Neither of these examples is an argument against high-tech solutions to more vexing problems.

Appelbaum includes this curious comment in his article: “Indeed, some high-tech solutions being offered to cities run roughshod over urban values. Cisco is marketing cafe-like spaces in residential neighborhoods where creative workers can telecommute to their offices, using powerful communications technologies unavailable to the average home. Take that logic to its limit, and only low-wage workers whose employers can’t afford the jazzed-up satellite sites will actually show up, physically, for work.”

To be snarky about it, at least the low-wage workers won't have to share the roadways or public transit with the creative workers ensconced in their jazzed-up satellite sites. Seriously, if we can get anyone off the roads during rush hour, doesn’t that benefit everyone?

It seems to me that Appelbaum is attributing political implications to smart-city technologies that simply are not there. Their primary purpose is not to disenfranchise or otherwise burden low-income people but to solve technical problems related to issues like energy use and transportation. There are political questions for sure: Is it worth it to spend $X today in order to potentially save $Y over the coming decade? Should externalities be factors in the equation?

Instead of railing against smart-city technology in general, Appelbaum might direct his efforts to ensuring that smart-city benefits extend to all residents, including low-wage commuting workers who might prefer less highway congestion or smart-metering capabilities that cut their electric bills.

I do agree with Appelbaum when he writes, “…the answers that make cities run more smoothly only inadvertently end up being the ones that make cities run more equitably. Deep data can learn and display policy cues that used to flow from guesswork. What it can do less reliably is reflect democratic action.”

Indeed, technology vendors are not going to be focused on reflecting democratic action—that's the role of city leaders and the citizens who elect them, and let's hope both are up to the task as smart-city systems roll out.

Appelbaum concludes with this curious passage: To reflect democratic action, “…you need more people discussing issues with more equal information and franchise. And that can most easily come from decidedly low-tech, but widely accessible, technologies like Facebook pages and e-mail chains. After all, cities don’t have to buy 'smart' software to get smarter.”

Perhaps we have here a new definition of Luddite: one who believes technology should not progress beyond Facebook.