The UN estimates that over two-thirds of the world’s population will live in cities by 2050, and IDC has forecast that by the end of 2021, spending on smart cities will exceed $130 billion. Moving forward, there may be a greater need for people to migrate to cities even faster, take advantage of technology-powered services, better healthcare, and improve their quality of life.
How are cities evolving?
Smart cities have evolved rapidly over the past couple of decades. In the early days, smart city projects focused on infrastructure, such as how super-fast broadband would revolutionize mobility, transport, retail, healthcare and education. The next iteration of cities focused mainly on solutions and architectures, while the current approach centers on data. Big data and predictive analytics drive smart city projects now, as cities generate vast swathes of data that can continuously improve services for residents and visitors.
This approach also sees a shift in the business model. With city populations set to continue growing and budgets being finite, the “city-as-a-service” model becomes more attractive and practical. A smart city as a service (SCaaS) approach eliminates upfront capex investment and delivers next-generation services to scale cost effectively.
The city as both innovation engine and ecosystem
Smart cities must be allowed to evolve and grow organically without being stifled or limited by budget constraints. I look at smart cities as not just innovation engines, but also as ecosystems that leverage collective intelligence. We need to encourage new ideas, and innovation should become a continuous process from which everyone and everything in the city benefits.
The smart city itself and the as-a-service model have specific objectives in common: both are designed around effectiveness, efficiency and sustainability. But the need for smart cities to be able to evolve within a budget and to innovate while remaining efficient, could require different thinking moving forward. By getting rid of silos, you can streamline operational management. Engaging with an as-a-service partner helps you do this while lowering the total cost of ownership (TCO). SCaaS also helps reduce risk in your smart city project. You can rapidly introduce new services, and your partner will assess the impact on your network and operations and make any necessary changes.
There is also the benefit of as-a-service helping smart cities redefine boundaries within the overall organization. Instead of having the various city functions operating in silos, smart cities can use as-a-service models to set them up as a collection of horizontal services that are available and shared across the entire city. Sharing data between traffic management and environmental health and safety departments, for example, would enhance the city’s overall offering.
Agility is another overall benefit: in its Flexible Consumption Models Study, Deloitte found that 75% of organizations said as-a-service models made it easier and faster for them to introduce new solutions. And 70% said it allowed them to use technological tools they would otherwise find too expensive to afford. This also applies to smart cities.
What is your path to the most effective smart city transformation?
Selecting the right ecosystem of partners is a significant step towards an as-a-service model for your smart city. Orange Business MEA has worked on several major smart cities projects and supports them with our regional innovation ecosystem. It plays a vital role in enabling continuous innovation in the smart city space.
The MEA region is home to numerous smart city innovations and initiatives that are forging ahead. In The Rise of Smart Cities – Digital Transformation in the Public Sector, KPMG has forecast that the MEA smart cities market will double in value from $1.3 billion in 2018 to $2.7 billion by 2022. An SCaaS approach could be indispensable in helping ensure MEA projects remain on budget, well-managed and ready to handle any potential disruptions the future may bring.
If you would like to talk about smart cities or anything else relating to digital transformation in MEA, please contact me on: sahem.azzam@orange.com.
Sahem Azzam is Senior Vice President, Middle East, Africa and Turkey, leading the Orange Business team operating across the region comprising 60+ countries from the regional headquarters and Innovation Hub in Dubai, supported by offices in Egypt, Morocco, Nigeria, Saudi Arabia and the Arabian Gulf, South Africa and Turkey. He has a special interest and expertise in infrastructure services, IoT, Big Data, Smart Cities, Blockchain and IT service management.