Smart cities look set to be gold mines when it comes to creating business opportunities.
According to an American study, smart cities – which focus on using technology to provide services and solve problems – could create business opportunities with a market value of trillions of dollars by 2025.
And this drive is already underway due to the Covid-19 pandemic.
According to the research, the uncertain post-pandemic context could drive these cities of the future to develop even more collaborative, data-driven infrastructure, in turn creating new business opportunities, notably in healthcare services and public security services.
Archana Vidyasekar, visionary innovation group research director at Frost & Sullivan, said: "Now more than ever, the strategy of being technology-first, optimistic, and focused on ‘smart' is critical. While Covid-19 has largely been a health crisis, it has disrupted city ecosystems and infrastructure tremendously.
"Smart technologies offer innovative solutions that can reverse the damage and bring some respite, if not normalcy. For instance, digital contact tracing can play a critical role in empowering citizens with knowledge of Covid-impacted areas and promote safer urban movement."
The sum spent by smart cities on technology is expected to show a compound annual growth rate (CAGR) of 22.7% in the next six years.
The study estimates that spending could reach US$327bil (RM1.35tril) by 2025, compared to US$96bil (RM396bil) in 2019.
"Smart cities will focus on data-driven and connected infrastructure, which will lead to higher adoption of technologies like AI and 5G.
"They will prioritise more digitalised services and a strong data analytics infrastructure, leading to increased spending toward technology," explains Malabika Mandal, visionary innovation group industry analyst at Frost & Sullivan.
More than 26 smart cities will be developed by 2025, with the majority – 16, to be precise – in North America and Europe, the study explains.
By 2030, over 70% of worldwide smart city spending will be driven by the United States, Western Europe and China.
The study also predicts that smart cities in the US and Europe will continue spending on 5G and autonomous and robotic technologies.
Similarly, China has renewed investments in fields such as 5G, smart grids, AI and data centres. The crowd analytics market – which had revenues of US$748.6mil (RM3.09bil) in 2020 – is forecast to grow by 20-25% by 2030, thanks to growing demand for crowd management and monitoring in smart cities. – AFP Relaxnews
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