Download Macro to Micro Implications of Smart and Sustainable Cities

City as a Customer Strategy:
Growth Opportunities From The Cities of Tomorrow
Archana Amarnath
Program Manager, Visionary Innovation Research Group
Top Mega Trends Covered By The Visionary
Innovation Research Division
What is a Mega Trend?
Mega trends are
transformative, global
forces that define the
future world with their far
reaching impact on
business, societies,
economies, cultures and
personal lives.
Urbanization
– City as a
Customer
Bricks and
Clicks
Future
Infrastructure
Development
Smart is the
New Green
Innovating to
Zero
Health,
Wellness and
Well Being
Social Trends
New Business
Models: Value
for Many
Future of
Mobility
Connectivity
and
Convergence
Beyond BRIC:
The Next
Game
Changers
2
Agenda
Introduction and Definition of City as a Customer
Strategy
Smart City Market - Key Smart City Segments of 2025
City Stakeholders Analysis – Key Market Participants and
New Business Models
Macro to Micro Opportunities
3
Mega Cities
Mega
Regions
Mega
Corridor
Smart and
Sustainable
Cities
4
There Will be 35 Mega Cities Globally By 2025 - 77% of Mega Cities to
be From Developing World
Moscow
Chicago
New York City
London
Paris
Madrid
Los Angeles
Mexico City
Nanjing
Harbin
Shanghai
Beijing
Hangzhou
Tianjin Seoul
Tehran
Tokyo
ChengduWuhan
Delhi
Osaka-Kobe
Chongqing
Cairo
Guangzhou
Mumbai
Kolkata
Shenzhen
Foshan
Istanbul
Bogotá
Hong Kong
Jakarta
Rio de Janeiro
São Paulo
Buenos Aires
Population in 2025
> 27 Million
18-27 Million
8-18 Million
Note: Mega City is defined as a city with population of over 8 million and GDP of
$250 billion or more
Source: : United Nations, Department of Economic and Social Affairs, Population Division (2012). World Urbanization
Prospects: The 2011 Revision , Frost & Sullivan, 2012
5
China to have 13 Mega Cities That Will Contribute $6.24 Trillion to
the Total GDP in 2025
By 2025, 921 Million people (65.4% of China’s Population) will Live in Cities (equals to 2.6 times of
U.S. Total Population)
Mega cities in 2025
Emerging mega cities in 2025 (4-8 million population)
Haerbin, 8.2
Ulumuqi
Beijing, 22.6
Changchun
Tianjin, 11.9
Shenyang
Dalian
Tiayuan
Shijiazhuang
Qingdao
Xi’an
Wuhan, 12.7
Jinan
Zhengzhou
Nanjing, 8.5
Chengdu, 10.0
No. of
Province
3
Urbanization
Rate
>80%
% in Country
Urban
Population
Suzhou
Wuxi
Chongqing ,13.6
Changsha
6.9 %
5
70 – 79 %
28.3%
7
60 - 69%
26.4%
14
50 - 59%
36.3%
2
< 50 %
2.1%
Ningbo
Hangzhou, 8.5
Wenzhou
Kunming
Dongguan
Xiamen
Guangzhou ,15.5
Shantou
Shenzhen,15.6
Zhongshan
Foshan, 9.8
Note: Mega City is defined as a city with population of over 8 million and GDP
of $250 billion or more. The figures represent population in Million
Shanghai, 28.4
Hefei
Hong Kong, 8.2
Source: Department of Economics and Social Affairs, United Nations; International
Institute of Applied System Analysis; Frost & Sullivan
6
Case Study: Delhi-Mumbai Industrial Corridor—One of the Biggest
Manmade Corridors; Completed by 2020
Dadri-Noida–
Ghaziabad
Investment Region,
UP
Manesar–Bawal
Investment Region,
Haryana
KhushkheraBhiwadi-Neemrana
Investment Region,
Rajasthan
Pithampur-DharMhow Investment
Region, MP
Gujarat-Ahmedabad
Dholera Investment
Region
Nashik–Sinnar–
Igatpuri Investment
Region
Maharashtra-Dighi
Port Industrial Area
$90 1,483
billion
The estimated
funding from
Japanese and Indian
government on a
50:50 basis
7
states to be
integrated
along the
corridor are
Delhi, Uttar Pradesh,
Haryana, Madhya
Pradesh, Rajasthan,
Gujarat, and
Maharashtra
9
Industrial
zones, 7
emerging Mega
Cities
3 ports, 6 airports and
high speed freight
lines
km
road length and 1,500 km
of rail link of DMIC
supported by financial
and technical aid from
Japan
3
million people
to get
employment
opportunities
with over 67 percent in the
manufacturing/processing
industry
6
investment
regions
each of 200 square km
size, doubling
employment and tripling
exports in 5 years
Source and Photo Credits: DMIC
7
Cities, and Not Countries,
Will Drive Wealth Creation In the Future
Cities like Seoul account for 50% of the
country’s GDP; Budapest (Hungary) and
Brussels (Belgium) each for roughly 45%.
Cities like Milan account for 11% of the
country’s GDP (~66% employment rate) .
What are the Micro Implications?
High Economic Power
Hub and Spoke Business Model
Transit oriented development
New Mobility Solutions
City as a Customer
8
City as a Customer –Urbanization To Create Numerous Cross-Sectoral
Micro Implications and Opportunities
Healthcare: M health, e-health
services, Health Access for All
with focus on Primary care,
prevention and monitoring, Medi
Cities, Hub and Spoke Hospitals
Mobility: Car sharing, bike
sharing, integrated door-todoor multi modal transport
solutions
Security: Safe Cities,
sensors, Intelligent home
security
Environment: Water
treatment systems Integrated
Power Sources and Zero Waste
for Industry
Retail: New Retail Formats,
Online retail, Virtual Stores,
Retail Parks
Smart Products: Smart
Infrastructure Smart homes,
Green buildings,
Personalized energy
monitoring,
Energy: Pattern recognition
smart meters, Home Area
Networks Cleaner
technologies such as CHP
Introduction and
Definition of Smart
Cities
11
Smart Diamond that Defines a Smart City
Smart Governance
Smart Citizen
Smart Energy
Smart Healthcare
Smart Building
4G
Smart Technology
Smart Mobility
Smart Infrastructure*
* Other Smart Infrastructure such as sensor
networks, digital management of water
utilities not included in other segments
Source: Frost & Sullivan analysis.
12
Key Parameters That Will Define a Smart City in 2020
Smart Energy: Digital Management
of Energy
• Smart Grids
• Smart Meters
• Intelligent Energy
Storage
Smart Technology: Seamless
Connectivity
• Broadband penetration
rate of over 80%
• Location Based
Services, Augmented
Reality, GPS enabled
devices/ phones
Smart Buildings: Automated
Intelligent Buildings
• Building Automation
• Intelligent Buildings:
Advance d HVAC,
Lighting Equipment
Smart Infrastructure: Digital
Management of Infrastructure*
• Sensor Networks
• Digital Water and
Waste Management
Smart Governance: Government-onthe-Go
• e-Government
• e-Education
• Disaster Management
Solutions
Note: *Infrastructure not included in
other segments
Smart Mobility: Intelligent
Mobility
• Low-emission Mobility
• Integrated Mobility
Solutions
• Multimodal Transport
Smart Healthcare: Intelligent
Healthcare Technology
• Use of ehealth and
mhealth systems
• Intelligent and
connected medical
devices
Smart Citizen: Civic Digital Natives
• Use of Green Mobility
Options
• Smart Lifestyle Choices
• Energy conscious
Source: Frost & Sullivan analysis.
Global Smart Cities
Over 26 Global Cities to be SMART Cities in 2025 - More than 50% of Smart cities
of 2025 will be from Europe and North America
Calgary
Vancouver
Amsterdam
Copenhagen
Beijing
Tokyo
Stockholm
Oslo
Helsinki
Seattle
San Francisco
Los Angeles
London
Paris
Toronto
Chicago
New York
Barcelona
Santander
(upcoming)
Berlin
Vienna
Tianjin
Seoul
Wuhan
Shenzhen
Singapore
Sydney
Selected Smart Cities in 2025
Source: Forbes Smart City List, Innovation City Index, Specific Smart Project Websites for Each City, Frost & Sullivan
14
Smart cities To Create Huge Business Opportunities With
A Market Value Of $3.3 Trillion By 2025
Smart City Market by Segments, Global, 2025
Smart Building
6
1
CAGR: 4.1% (2012-2025)
7.4%
Smart Healthcare
5
Smart Governance and Smart
Security
10.4%
CAGR: 11.6% (2012-2025)
CAGR: 8.8% (2012-2025)
36.8%
10.5%
Smart Transportation
Smart City Market
2
4
CAGR: 19.6% (2012-2025)
Smart Energy
11.4%
CAGR: 28.7% (2012-2025)
23.4%
Smart Infrastructure* 3
CAGR: 12.0% (2012-2025)
Note: The graph represent the market share of each segment in the smart city market.
For more information on smart city market sectors please refer to appendix
*Other Smart Infrastructure such as sensor networks, digital management of water utilities
not included in other segments
Source: Frost & Sullivan analysis.
Case Study of SMART City Plan: In Santander, Spain 10,000 sensors feed BIG
DATA into Data Servers that Integrates Various Infrastructure
16
Difference Between Smart and Sustainable City
Smart City
Smart cities are cities built on “Smart” and
“Intelligent” solutions and technology that
will lead to adoption of at least 5 out of the 8
smart parameters.
Sustainable City
Sustainable cities are cities that are built on ecofriendly basis. These may not necessarily include
“intelligent” systems but are built more on an
energy-efficient or environment-friendly
objective.
17
Global Snapshot of Sustainable/ Eco Cities in 2025
Europe
Cardiff
Brussels
Zurich
Lyon
Frankfurt
Milan
Rome
Cambridge shire
Marseille
Tampere
North
America
Portland
Sacramento
Oakland
San Diego
Dallas
Houston
Orlando
Austin
Minneapolis
San Jose
Denver
Boston
Ottawa
Montreal
Philadelphia
Washington DC
Columbus
Edmonton
Sustainable / eco-city
in 2025
Sustainable / eco-city
built from scratch
Latin
America
Brasília
Belo Horizonte
São Paulo
Rio de Janeiro
Curitiba
Bogotá
Mexico City
Geneva
Graz
Riga
Vilnius
Metz
Tubingen
Montpellier
Bordeaux
Casablanca
Norwich
Hamburg
Middle East &
Africa
Accra
Johannesburg
Cape Town
Durban
Tunis
Masdar City
Doha
Note: Eco Cities are cities built on a green initiative, from buildings to transport, governance, city planning,
energy, and technology. These cities are either upgraded or built from scratch
Moreland
Manchester
Gothenburg
Isle of Wight
Glasgow
Liverpool
Dublin
Marseille
Bergen
Edinburgh
Nantes
Gyor
Istanbul
Bursa
Ankara
Eskisehir
Izmir
Denizli
Antalya
Adana
Edinburgh
Asia-Pacific
& Australia
GIFT
Sino-Singapore Tianjin Eco-city, Tianjin
Nanjing
Hong Kong
Foshan
Guangzhou
Wuxi
Osaka
Yokohama
Wanzhuang Eco-city, Hebei
Medan
Palembang
Jakarta
Surabaya
Denpasar
Makasar
Balikpapan
Adelaide
Moreland
Source: Siemens Green Index, Frost & Sullivan, 2012
18
City Stakeholders
Analysis , Business
Models
City Stakeholders Analysis- Relationship Between Stakeholders are
Integral to a City Project
Direct Stakeholders
City as a Customer
Role in smart city
City Authorities
Stakeholder Types
Government
Management
Service
Delivery
Infrastructure
and Services
Local
Enterprises
Citizens
• Plan and execute
governance system,
government services and
fundamental services
• Provide access to
employment, healthcare,
education, and
recreation.
• Located in the city to
promote industrial
growth and enable
market growth.
• Use of intelligence
and insight to create
plans, system
strategies, and
support decisions
• Supports effective
and efficient
infrastructure.
• Create digital platform
for data processing and
analysing
• Create digital
infrastructure
.
• Plays the role of interface
and operator
• Enables the
generation of
intelligence
• Provide intelligent,
logical and
information
framework
• Creates and delivers
advanced services
Indirect Stakeholders
Enabling City as a Customer
Technology and Application Providers
Systems Integrators
Infrastructure Services Providers and Operators
20
Smart Cities Business Models
Majority of smart city projects are developed under Business Operate Managed (BOM)
business model
2
1
The smart city planner independently
builds the city infrastructure and
delivers smart city services. The
operation and maintenance of the
services is fully under the planner’s
control. Eg. Jubail
4
The smart city planner appoints a
trusted partner to develop the city
infrastructure and services. The
partner operates and manages the
smart city services. The city planner
has no role further. Most of the publicprivate partnerships are build on this
model. Eg. Rio
Build
Business
Own
Own
Operate
Operate
(BOO)
(BOO)
Build
Operate
Transfer
(BOT)
Build
Business
Operate
Operate
Managed
Manage
(BOM)
(BOM)
Open
Business
Model
(OBM)
The smart city planner appoints a
trusted partner to build the city
infrastructure and provide smart city
services for a particular area within a
time period. After completion the
operation is handover to the smart city
planner. Eg. Norcross
3
The city planner allows any qualified
company or business organisation to
build city infrastructure and provide
city services. The city planner
however will impose some regulatory
obligations. Eg. Amsterdam
Note:
City Planner: Governing authorities involved with urban planning/land use planning that design plans for the development and management of urban and
suburban areas based on land use compatibility, economic trends, environmental implications and social needs.
Partner: Private / public stakeholders collaborating with city authorities over urban planning and smart city initiatives
Source: Frost & Sullivan analysis.
21
Convergence of
Competition
Convergence of Technology Will Lead to Convergence
of Competition
IT Players
SAP
HP
Point of Convergence
ST
Electronics
Oracle
Microsoft
Google
Cisco
Verizon
Telecom Players
IBM
AlcatelLucent
Senergy
O2
Deutsche
Telekom
Siemens
General
Electric
ABB
Emerson
Schneider
Electric
Honeywell
Energy/Infrastructure
Players
Eaton
Johnson Controls
Rockwell Automation
Automation/Building Control Players
Note: This is an illustration and does not show
all market players
Selective Wish List of Products/Services Portfolio That Can be
Offered by Smart City Integrators
Products / Services
SECTORS
Mobility
Energy
IT and Telecom
Security
Healthcare
Traffic
management
Smart grids;
energy
management
City Cloud
Computing
Identity
Management
Integrated health
record system
Electric vehicle
charging
infrastructure
Smart meters
Data-centric
Consulting
Services
Cyber Security
E-health
Tolling and
congestion
charging
Smart home
appliances
Information
Management
Services
Intelligent, real
time security
management
M-health
Integrated
mobility
management
Flow and
regenerative
technologies
IT Advisory
Services
Sensor actuator
solutions
Tele-consultation
facility
Geo Fencing &
Asset Tracking
Renewable
integration
Managed
Security Services
Logistics /
Mobility security
management
Home health
Parking
Management and
Payment
Solutions
Sensors and
Smart Material
Building security
Data and
Business
Analytics for
Healthcare
Authentication
and Monitoring
(Sensors, Video
Surveillance)
Governance
e-Services
Transactions and
Payments
eCommunication
Notifications and
alert service
e-Administration
Tools for public
administration
e-Security
Law enforcement and
emergency
management
e-Businesses
Registration Services
Patent Renewals
M-Governance
SMS Tax Returns
SMS Utility Bills
Source: Frost & Sullivan Analysis
24
There Are Four Different Roles Smart Cities Players Can Take
1
Integrators
2
Network
Service
Providers
3
Pure-Play
Product
Vendors
4 Managed
Service
Providers
Smart city integrators are project integrators that bring together various
sectors of the smart city through pre-packaged platforms thereby providing
a unified , holistic and end-to-end integration of multiple sectors
Example: IBM, Oracle, Accenture,
Smart city network providers offer collaborative networks, data analytics
and enterprise working solutions that connect people, assets, systems and
products by leveraging on their networking and M2M capabilities.
Example: Cisco, Verizon, Ericsson, AT&T
Smart city product vendors provide “hard assets” like smart meters and
distribution devices (e.g., automated switches, controllers for capacitor
banks and voltage regulators) that operate as the main nodes of
connectivity.
Example: Eaton, Honeywell, ABB, Schneider Electric, Siemens
Smart city managed service providers offer round-the-clock monitoring,
complete management, compliance monitoring, and on-site consulting.
These services are provided either in-house, co-managed, or are completely
outsourced (third party providers)
Example: IBM, Serco, SAIC, Infosys
25
Smart City Players and Typical Suite of Solutions (Examples)*
•
•
•
•
•
Integrators
Network Service
Providers
Pure-Play Product
Vendors
Managed Service
Providers
Software Focused
Communication Focused
Infrastructure Focused
Operations Focused
Enterprise resource
planning for
municipalities and
governments
Central Operations
Centers
Smart City
Consulting –
Reference
Architecture and
Framework
Planning
Big Data Smart City
Analytics
Cloud-based smart
city services
•
•
•
•
•
•
Networking
equipment such as
routers, switches,
SIM chips
Geographical
information systems
Remote access and
monitoring.
Wireless Area
Network
M2M Big Data
Analytics and
Consulting
Unified
Communication
•
•
•
•
•
•
•
•
Smart devices and
control systems
Sensors
Smart Meters
Power and
automation
technologies
Turnkey substations
Utility hardware
and software
Smart Parking
Infrastructure
Mobility Integration
& parking
infrastructure
•
•
•
•
•
Monitoring and
management of
smart city related IT
infrastructure
Prevention,
detection, and
reporting of security
threats
Feature solutions
for premises, cloud,
and hybrid
environments
Support in-house,
co-managed, and
outsourced options
Manage risk and
compliance
*The list is not exhaustive.
26
Key Take Aways and Recommendations
Recommendations to Cities
Creates Special Smart City
Consortium
Encourage Open
Collaboration
Explore Financial
Instruments Based Funding
Create a specific decision making
entity comprising of government
bureaucrats, transport and utility
providers, key decision makers,
and thought-leaders
Make information from public
systems openly available and
accessible to citizens and
entrepreneurial businesses to
foster innovation in new services
Make alternatives to “non-grants”
based funding to projects such as
equity, loans or risk-sharing
programmes through special
structural funds.
Recommendations to the Private Sector
Catalyse Smart City
Consortiums
Shared Services and Big
Data Analytics
Become a strategic partner
and Choose Your Role
Public-private consortiums to
offer integrated smart city
services
Cloud-based services on
smart city management and
analytics-based services
which local authorities and
other public sector agencies
can access on a shared basis
Explore new business models
where firms could participate in
the governance of cities, (like
managed services) and become a
supplementary part to the
government
27
Case Study : How Siemens Aligns Itself to Mega Trends
It is important for companies to have a “City as a Customer” Strategy
Source : Siemens AG. All rights reserved
28
From Macro to Micro: Taking Mega Trends from Information to
Strategy Implementation
Macro
To
Micro
Mega Trend
Analysis of Opportunities and
Unmet Needs
Selected trends that impact your
business and markets
Sub Trend
Impact on Future Product/
Technology
A sub-layer of trends that has a
wide ranging impact
Impact to Your Industry
Visualising the roadmap of these
critical forces through scenariobuilding and macro economic
forecasts
29
Visionary Innovation Research
No
Research Topics
No
1
Urbanisation and Mega Cities and Impact on Industries and
Business
14
2
Global Mega Trends and its Implications to Urban Logistics
to 2020
Connected Living: Macro to Micro Implications of
Robotics and Artificial Intelligence on Consumer
Applications
15
Mega Trends in UK
Worlds Top Mega Trends to 2020 and Impact on Society,
Cultures, Business, and Personal Lives – 2012 Update
16
New Business Models
Bricks and Clicks: Impact of Connectivity on Future of
Retailing
17
Industries of the Future
18
Big Data and its Implications on Industries
19
3D printing and its Macro to Micro Impact on
Manufacturing and Supply Chain Management
20
Augmented Reality and its Applications
21
Future of Telecom
22
Mega Trends in Europe
23
Mega Trends in North America
24
Mega Trends in Middle East
3
4
6
7
Research Topics
Smart Cities and Impact on Convergence of Competition
Mega Trends for Africa
8
Mega Trends for India
9
Mega Trends for LATAM
10
Mega Trends for Turkey
11
Mega Trends in China
12
E Retailing in the Automotive Industry
13
Future of Mobility—New Business Models, Opportunities,
and Market Entrants in Mobility Integration
30
Contact Information
Archana Amarnath
Program Manager, Visionary Innovation Research
Group
(+44) 2079157893
[email protected]
31