Smart cities will save us $5 trillion per year: But we have to build them first
How APIs enable us to accelerate the vision of smart cities and achieve unprecedented value.
When the idea of smart cities was first conceived, the question was: are they possible and what is required? We could dream up the kinds of experiences and opportunities we’d like our cities of the future to provide, yet it was uncertain how quickly technology could get us there. Now that the Internet of Things (IoT) has grown from a mere fascination to a digital revolution, and technology investments in the space have exploded, we can put this question to rest. From a technology standpoint, smart cities are not just possible, but inevitable.
But for a smart city to flourish and for its true potential to be realized, an enormous amount of coordination is required between citizens, governments, businesses, infrastructure providers, transportation services, and a multitude of other stakeholders.
While technology is the first major barrier to the proliferation of smart cities, investment and integration remains the second. Moving away from the status quo is always met with some resistance, especially when the outcome of that change is nebulous. When you factor in the costs and sheer complexity of creating and building smart cities – on top of their uncertain value – it’s no wonder we don’t see our cities changing overnight.
So, why should we continue to hope for, work toward, and eventually build these smart cities? At CA, we are convinced that technology can be used to build better business outcomes across industries. We’ve seen firsthand how mobile, the application economy, and IoT have transformed the lives of consumers, and brought new life to aging industries.
The same will be true for our cities. That’s why we are excited to partner with Chordant, an Interdigital business, to commission a report by ABI Research titled ‘Smart Cities and Cost Savings.’ The white paper provides some much-needed validation of the value promised by smart cities, which was previously difficult to quantify.
What we found is not only will smart cities have a tremendous impact from a technology, infrastructure, and quality of life perspective, but they will also offer enormous cost-saving potential. Smart cities five years from now, with an estimated 10 million inhabitants each, have the potential to save governments, enterprises, and citizens over $5 trillion per year aggregated across 75 cities worldwide.
These savings include a potential $5 billion for governments, $14 billion for enterprises, and $27 billion for citizens, arising from savings generated by smart utilities and buildings, smart transportation and manufacturing, and hybrid education.
Reductions in operational costs and faster and better-informed decision making are just a few ways the combination of infrastructure and technology provides value in a smart city. In large smart cities of the future, enterprises could potentially reduce their operating costs by 25 percent.
Are smart cities possible? Absolutely. Is their value worth the investment? We can now confidently say yes. All that remains then is: how can we build them? It will take substantial investment in infrastructure, technology, and systems, and a great deal of work to coordinate these resources into a cohesive solution. APIs will play a vital role in this integration, and it is an area that we are putting significant focus on at CA.
APIs enable the secure and governable sharing of open data, the acceleration of native app development, and the ability to authenticate critical smart city infrastructure so that it and its data are used responsibly. Linking citizens, governments, and city resources through continuous, real-time data, APIs create the open ecosystems characteristic of the smart city of the future. Simply put, secure, shared APIs are the building blocks of IoT and will play a fundamental role in making smart cities a reality.
Smart cities will be built through the coordination of numerous stakeholders and resources – and they won’t be built in a day. Successful management, integration, and security of investments will be paramount, and will require continuous effort. CA is excited to be part of this opportunity.
We would love to hear your thoughts around smart cities and APIs. Please use the comments section to share.