Chinese Firm Breaks into the High Tech Smart City Market

Navigant Consulting, a specialized global professional services firm on new technology, recently published a report on the leadership in the smart cities tech market. The consultancy examined the strategy and execution of 16 leading smart city suppliers, providing interested cities with an objective assessment of these companies’ relative strengths and weaknesses in the global market.

A smart city is an urban development vision to integrate multiple information and communications technology (ICT) solutions in a secure fashion to manage a city’s facilities to improve the efficiency of service and quality of life. ICT allows city officials to interact directly with the community and the city infrastructure, to know what is happening in the city, how the city is evolving, and how to achieve a better quality of life. Through the use of real-time systems and sensors, data is collected from citizens and objects which are then processed in real-time. 

Cities around the world are looking into the smart city concept to help with their respective urban planning and lay out a vision for how cities can use technology to improve services and boost the economy. The smart city market is estimated to be worth USD 12.1 billion in 2016 and is expected to increase to USD 27.5 billion by 2023. It is attractive to a broad range of suppliers but this is an extremely challenging market with complex dynamics. City services are always politically sensitive and suppliers must take into account not only the evolving demands of residents, but must also be innovative in addressing new problems when they arise under the tight budget constraints of almost all cities nowadays.

Navigant Consulting examined 16 leading smart city suppliers (see figure) with the capacity to provide leadership on large-scale smart city projects spanning multiple operational and service areas. These smart city suppliers were rated on 10 criteria: vision, go-to-market strategy, partners, product strategy, geographic reach, market presence, sales and marketing, product performance and features, product integration, and staying power. Using Navigant Research’s proprietary methodology, vendors were profiled, rated, and ranked with the goal of providing industry participants with an objective assessment of these companies’ relative strengths and weaknesses in the growing global smart city market.

The Top 10 vendors were:

IBM
Cisco
Microsoft
Siemens
Hitachi
Huawei
SAP
Panasonic
Oracle
Ericsson

IBM and Cisco retained their leadership positions among smart city technology providers. However, the other players are improving their technical capacities and are developing offerings that meet the growing interest in urban Internet of Things (IoT) applications, big data solutions, and the transformation of urban approaches to energy policy, mobility, and resilience.

Among the 16 leading smart cities suppliers, Huawei has the shortest history of involvement in the field. Apparently, it been successful in extending its leadership position in the ICT area to the smart city market. Its Safe City Solution has reportedly been deployed in more than 100 cities globally in collaboration with multiple technological partners. Huawei has been successful in breaking into the smartphone and global telecommunications market, and whether it will be successful in the demanding smart city market will be interesting to observe.