Cities around the world are turning to ‘smart’ technology to increase efficiency and improve residents’ quality of life. And with the world undergoing the largest wave of urban growth in history, investment in smart city technology is set to almost triple.
According to a new report from Grand View Research, the global smart cities market will generate revenues of $1.42tn (£990bn) in 2020, representing a compound annual growth rate (CAGR) of 13.6% from $568bn (£395bn) in 2013.
The increasing global population and rapid urbanisation, coupled with continuous industrialisation, are key factors expected to positively affect the market, leading more and more cities to invest in the latest technologies including sensor networks, data analytics, cloud computing and wireless communications.
Smart technologies can help cities address a wide range of challenges including urban mobility, energy management, street lighting, public safety and water management.
Smart transportation was the largest application segment in 2013, accounting for 16.1% of the global market share. This segment is anticipated to grow at an estimated CAGR of 15.2% over the forecast period thanks to the rising popularity of transport solutions including parking management, ticketing management, guidance systems, passenger information systems, traffic management and supervision systems.
Grand View Research found that the major players dominating the smart cities market are IBM, Honeywell, Cisco, Accenture, Oracle and Alcatel-Lucent.
A recent report from Navigant Research named IBM and Cisco as the leading smart city suppliers, and said that a number of other players are investing in their smart city capabilities, partner networks and city relationships, including Microsoft, Siemens, Huawei, SAP, Panasonic and General Electric (GE).