Cities across the world are starting to adopt “smart city” technology. To do this they need to collect huge amounts of data from a wide array of sensors. In order to make a city truly smart, city officials need to be able to analyze information that is being generated from security cameras, traffic lights, municipal buildings, sewage pipes and even residents’ handheld devices.
Big cities are able to spend big to install and oversee these sensors. New York City even went as far as to appoint a Chief Information Officer, a position that some technology companies have yet to adopt. Smaller cities, or those without a clear understanding of how to integrate and utilize the latest sensor technology, leave the arduous task of setting up a smart city system to employees that likely have little or no experience in hardware or software. These concerns are bolstered by the fear of one of the increasingly sophisticated cyber attacks that have been targeted at companies with important data like Equifax.
This has left an opening for telecom firms, who already have significant connected infrastructure to offer a complete “sensing-as-a-service” package. It might give them access to the data that they need in order to compete with the some of today’s biggest companies like Google and Amazon in the impending data arms race.
There are many other competitors in the smart city space including Cisco, Huawei, Alibaba, Dell, Microsoft and of course Google who just bought Xivley for $50 million. But, with the infrastructure already in place and an impending switch to a new 5G architecture that is said to be 10 times faster, telecoms might be one of the best suited to create a sensing-as-a-service platform that cities will likely need to meet their technology goals.
If telecom companies are able to partner with cities before the big tech players it might be a change in the balance of power. While IoT is a relatively small part of telecom income (Verizon had $220 million in IoT sales last quarter compared to $31.7 billion in total revenue), it will be an increasingly valuable data set. The biggest companies in the world (Apple, Amazon, Google, Facebook) have gotten to where they are by collecting and monetizing data about our online lives. Whichever company is able to do the same for our physical lives will likely be amongst them at the top of the value chain in the near future.