Smart City Growth and Information Technology Solutions

7 minute read

*Updated September 2022

Smart cities are becoming our reality. Thanks to the combination of the Internet of Things (IoT) with wireless technology, governments have the power to improve the quality of life for people living in cities.

According to a report by Markets and Markets, the market for smarter cities is projected to grow from $457 billion in 2021 to $873.7 billion by 2026, at a CAGR of 13.8%. What is more impressive, is that McKinsey research predicts that 600 smart city cities will generate 60% of the world’s GDP by 2025, which means that the presence of smart city technology is going to rise significantly. 

The smart city market is expected to expand due to increasing public safety demands, urban population growth, and government policies. Video tracking, DNA phenotyping, real-time license plate plus facial recognition are being commonly used in smart cities, demonstrating the demand for innovation in these areas.

What are smart cities?

Smart cities represent platforms for developing, deploying, and promoting sustainable growth activities to solve ever-evolving city urbanization challenges. It is primarily made up of information and communication technologies (ICT). An interconnected network of objects and devices that exchange data using wireless technology and the cloud represents a major part of this architecture.

Real-time data is received, analyzed, and managed by cloud-based IoT applications to assist municipalities, businesses, and residents in making smarter decisions that increase the quality of life.

Citizens interact with smart city environments in a variety of ways, including through their laptops and handheld computers, as well as through their vehicles and homes. As sensors and data are linked to a city's physical infrastructure and facilities, costs can be reduced and sustainability improved.

With the assistance of IoT applications, communities can increase electricity delivery, streamline garbage disposal, reduce road congestion, and even enhance the quality of air.

smart cities 01

Urbanization solutions and smart cities

To understand the need for smart cities, let’s look at some stats. In 2017, the United Nations raised the medium variant population forecasts for 2050 and 2100 to 9.8 billion and 11.2 billion, respectively.

According to the World Economic Forum, in 2020, urbanization accounted for 56.2% of the global population. Half of these people lived in cities with populations of fewer than 500,000 people. This proportion is expected to increase to 68% by 2050, as per projections by the United Nations, urbanization, or the incremental transition of the human population from rural to urban areas, along with global population growth. This will bring another 2.5 billion inhabitants to urban areas by 2050, with Asia and Africa accounting for nearly 90% of this rise.

To keep up with the exponential growth that is overwhelming our cities, we need ecological, social, and economic resilience along with efficient urban planning. For this purpose, the Sustainable Development Goals (SDGs) agenda was decided upon by 189 countries in September 2015 at the United Nations. However, we all know how long collective policies and processes will take and time is limited.

The initiatives toward smart cities can accelerate results and push the world to achieve the Sustainable Development Goals set by the UN, hopefully blending technology and sustainability together. Citizens and municipal governments are unquestionably more flexible in launching fast urban planning projects where smart city infrastructure is critical to progress.

For example, connected traffic lights collect data from sensors and vehicles, in turn changing the light’s tempo and duration in real-time to reduce traffic jams. Moreover, intelligent garbage cans automatically submit data to waste operators and arrange pick-up if required rather than on a predetermined schedule. These are only some of the contributions smart cities can have toward urbanization solutions to a more sustainable future granting a higher quality of life for everyone. 

Making these sorts of shifts, on the other hand, isn't as simple as setting up a network, placing some IoT applications at strategic locations, and calling it a day. When it comes to creating a smart city, you must take many things into account. It necessitates some careful consideration of scale, execution, and cross-departmental cooperation in the urban planning process.  

Combining various types of information technology can make this process easier and more efficient. Here are some of the technology uses that smart city infrastructure should involve.

Data: the building block of smart city technology and urban planning

The most essential thing to remember when considering any smart city technology is that your choices can only be as successful as the data you have at your disposal. To reap the benefits of advancements in processing and analytics, you must first determine what information you need, how to obtain it, how to move it to the appropriate location, and how to store it. 

The vast volumes of data generated by a smart city must be processed rapidly. Some cities have selected open data hubs as a way to release city information online so that everyone can view it and use predictive analytics to forecast future trends.

In urban planning, historical patterns are especially relevant because whatever approach you use must be robust, ensuring you've taken the appropriate precautions to guarantee success, regardless of what happens. This necessitates redundant copies, on-site and in the cloud. It also means you'll have to be picky on what details you keep and for how long.

For instance, an intelligent energy network can produce many terabytes of data every day, but you certainly don't need to hold all of that information forever. Establishing local storage and filtering through it regularly on the cloud network is crucial. To make the most of cloud infrastructure, it will be critical to concentrate on the data points you need to keep processes optimized.

Nothing without networks

Smart city applications and processes depend on vast amounts of data and knowledge collection, retrieval, and sharing. As a response, the foundation of smart cities should be a secure connectivity and networking system that allows for data transfer.


The planning of smart cities relies on connectivity. The use of a fast and secure network that can relay data is central to all smart city projects and necessitates connectivity. Any smart city communications system would include a mix of network technology, such as 4G LTE, 5G, and Wi-Fi, with each having a distinct role.

Relying on iot applications

There are digital specifications in addition to the physical demands of your network. The most important goal is to create a low-latency atmosphere that helps your decision-making procedures to keep up with the frantic speed of modern city life.

Consider which IoT devices should be connected and how they should be connected. For reference, a sensor that records the level of water of a well once a day is likely to have somewhat different specifications than a traffic camera.

A low-power wide-area network (LPWAN) protocol is vital for systems that run on batteries. The energy management aspect of LPWAN allows you to maintain a data report on these systems so you don’t have to replace their batteries regularly. 

Although most user IoT applications communicate over short distances using Bluetooth or Wi-Fi, many smart city IoT applications need long-range network access using cellular or LPWAN, or even a hybrid of the two. Although virtually universal, cellular technology offers coverage and bandwidth at the cost of electricity expenditure. It can transfer vast volumes of data over lengthy ranges, but it depletes battery power quickly.

An IoT-enabled city can intelligently control energy usage and emissions through the urban environment, rerouting traffic through density in real-time, and automatically scheduling fixes for broken structures like street lighting or tunnels. As IoT technologies are implemented in a city, it becomes easier for the community to link to its network of vendors, operators, and collaborators who offer the resources that the city requires to become more integrated.

Artificial intelligence (AI): a useful tool in big data technologies

AI and big data technologies are inextricably related. AI applies to a variety of techniques for teaching a non-human machine to learn from its errors and mimic human intelligence. AI can be used as a big data tool to browse through vast amounts of data quickly and reliably to produce data forecasts and cost-effective smart city solutions.

The AI being supervised or unsupervised affects how this happens. Data sets and goal parameters are generated in supervised learning to train AI models to find unique approaches in the obtained raw data. Following that, the AI will perform pre-programmed activities and actions while also investigating new options and scenarios that can have more significant results than existing strategies. Unsupervised learning uses non-labeled and non-classified data sets to train and query AI networks, which then look for secret trends in the data.


As such, AI can find many uses in smart cities. For example, collecting and analyzing public transportation usage data assists cities in making more educated choices when it comes to changing public transportation routes and timings and allocating more precise maintenance budgets. Moreover, AI can be used to build predictive models for smart grids to estimate electricity prices and demand for specific periodic intervals.

Is the future bright for smart cities?

The Covid-19 pandemic has thrown several industries into disarray. Hardware, apps, and digital spending have changed from linear patterns in the flurry of switching from the workplace to the home, and it is beginning to evolve as working remotely becomes streamlined.

However, for many investors all around the world, the pandemic has become a spark for progress.

Businesses expect to increase cloud computing spending in 2021, according to new trends, while efforts to implement evolving digitalization will decrease as firms continue to reduce costs. On the other hand, companies have recognized that remote working is only feasible with new ICT and emerging technologies, and investment in these areas is expected to stabilize and grow over 2021.

By 2026, smart cities could deliver a total economic profit of $20 trillion, according to an analysis by Chordant. Green stimulus packages and policies that help companies minimize their financial burden while also creating opportunities for ancillary revenue are being used to incentivize companies to finance smart city projects.

According to experts from Barclays, prioritizing improvements to urban planning is critical to growth, as it ensures that the pillars are in place so additional smart city technologies and programs can emerge. Four main investment areas are expected to climb to the top, according to the analysts:

Some critical factors to consider when building a smarter city are:

-Data is crucial, so you'll need the right technology to sort, archive, and interpret it.

-The network should have the power to get the right information to the right people at the right time, with particular attention to security

-A solid network should give you the foundation for well-connected IoT devices

-Consider privacy concerns from the beginning

-AI can help you make data actionable and contribute to making more intelligent decisions about problems in your city

We should expect expanded investment in smart city technologies as a result of a gradual Covid-19-related reduction accompanied by consistent growth.

To maintain industry growth you need innovation and investment. Valuer provides insights into various industries and sectors to help companies scout new technologies, innovative companies, and growing trends.

smart cities 02

The rundown on information technology

While signs that smart city innovation boosts global prosperity abound, investors are wary as the planet recovers from a pandemic and economic downturn. Businesses, states, and private companies will gain a lot from accessing a large amount of data as IoT applications and digitalization become more prevalent, allowing us to identify and forecast investment obstacles and opportunities.

When our physical and digital realms grow more interconnected, we are faced with opportunities to participate in a future of constant and long-term transition. Smarter Cities are using Information Technology to understand opportunities and solve obstacles that will come down the road during urban planning.

Innovative Solutions Reshaping Infrastructure Development
7 minute read
Grundfos - Helping Discover Innovative Technologies in the Water Sector
6 minute read
How to Use Valuer to Do a Deep-Dive on Specific Tech
7 minute read
The Future of Innovative Smart Grid Technologies (download report)
7 minute read
The 3D Printing Innovations of the Future
7 minute read
How Insurtech is Reshaping the Future of Insurance (download report)
7 minute read