Smarter Cities Require New Solutions

One of the current trends of the last 15 years in the development of urban areas are "smart" solutions. Their benefits are undeniable: they simplify the current management of urban infrastructure, improve the quality of planning and forecasting, and make the process of receiving public services more understandable. Let's consider the main trends and prospects of the market for "smart city" solutions.

Global and Russian Market of Smart City Solutions: Key Indicators

Global Market Insights experts calculated that in 2023, the global market for smart city solutions was worth almost $560 billion. At the same time, by 2032, if the current growth rate (about 15-17% annually) is maintained, it will exceed $2 trillion. More than 180 cities can be classified as smart, and the number of piloted solutions exceeds a thousand.

In terms of regions of the world, North America, which is highly urbanized, occupies the leading position in the implementation of “smart” solutions. It accounts for about 30% of the entire market. At the same time, the greatest growth is demonstrated by the countries of Southeast Asia, which have become trendsetters in terms of “smart cities”.

More than 20% of the global market for smart city solutions is accounted for by two companies: ABB and Honeywell International Inc. Other leading players include IBM, Cisco Systems Inc, General Electric, Huawei, Xiaomi.

In turn, in Russia, the volume of products for "smart cities", according to the Ministry of Construction, is about 400 billion rubles. By 2025-2026, according to the general director of OOO "Akselerator Vozmozhnostey" Maxim Vozhagov, it can grow to 4 trillion rubles (or $52 billion). The main player in the domestic market of solutions for "smart cities" is the company "Rostelecom".

Market structure

There are several different approaches to identifying the segments into which the smart city solutions market is divided. In this review, we have compiled some of them to present the diversity of such solutions as clearly and understandably as possible.

Transport management system. Allows real-time monitoring of the transport situation (road congestion, number of public transport on the line, etc.) and, if necessary, taking prompt measures (adjusting the operation of traffic lights, reversible lanes, etc.). Unmanned transport is also a promising area.

Electronic government. Allows citizens to receive the necessary government services in a "single window" mode, and authorities to simplify interdepartmental interaction and reduce the time for providing services. Also, thanks to information from various databases, the process of providing government services becomes personalized and takes into account the characteristics of a specific citizen: age, marital status, availability of benefits.

Infrastructure management system. Allows real-time monitoring of the condition of buildings and public utility infrastructure facilities and, if necessary, quick dispatch of emergency teams and switching of facilities to backup sources. As a result, a full-fledged digital twin of the city is formed, containing information about all buildings and communications. This segment accounts for about 30-35% of all "smart" solutions.

City video surveillance system. Consists of cameras installed on streets, buildings and in public transport. Allows to collect data on street traffic and transport congestion, and, if necessary, to track offenders. City analytics system. Allows to use big data analysis technologies and machine learning to form well-founded and impartial conclusions based on data collected by other systems. This improves the quality of decision-making and urban planning.

It should be noted that most solutions are based on IoT (Internet of things) technology. It allows you to form a single structure from various elements and obtain data from them for subsequent analysis.

Key Challenges for the Global and Russian Market of Smart City Solutions

Of course, the key challenge for both the global and Russian sectors is to ensure the security of the information obtained. Databases at the disposal of city and municipal authorities are a tasty morsel for various types of cybercriminals, because having mastered arrays of such information, they will be able to obtain, de facto, a full portrait of a potential victim and use it for illegal purposes. Therefore, solutions that allow protecting such valuable information are of particular importance: antiviruses, data encryption systems, firewalls, etc.

Another serious task is the integration of various databases into a single system. Even within the same city, different authorities may have different arrays of information in different formats, which complicates the process of their unification, analysis, and interdepartmental interaction (both when solving citywide problems and when providing public services). Accordingly, it is necessary to either immediately implement universal formats or work out the issue of integration hubs, which will become an intermediate link.

For the Russian market, import substitution of some digital products and hardware has become a significant challenge since 2022. This concerns, for example, the AutoCAD application used in BIM modeling, which allows you to create a digital twin of a building, which significantly simplifies not only its design, but also its subsequent operation.

Prospects for the global and Russian market of "smart cities"

In what directions will “smart” solutions for cities develop? The first direction is the use of artificial intelligence and Big Data to improve the quality of urban planning and forecasting in various sectors: from economics and construction to utilities and the social sphere. Another advantage of implementing AI for these purposes is cost reduction, including through optimization of the staffing levels of government agencies.

More and more attention will be paid to the intelligent system of urban transport management. One of the areas is the introduction of unmanned transport. If unmanned taxis are no longer a novelty, then unmanned trams will probably appear on the streets of Moscow by the end of 2024. We should also expect the appearance of unmanned trains on the Moscow Central Circle and in the metro.

In recent years, ESG trends have gained importance in combination with the need to optimize costs amid the coronavirus pandemic and geopolitical complications. The introduction of “smart” solutions will not only reduce the negative impact on the environment, make city management socially oriented and transparent, but also reduce costs and find new areas for generating income. For example, by analyzing the existing structure of city revenues using AI and Big Data, the authorities will be able to give the city economy a new innovative specialization.

In Russia, the development of "smart cities" is supervised by the Russian Ministry of Construction. In 2021-2024, more than 28 billion rubles were allocated to finance the corresponding federal project.

Why is it important to participate in the new ExpoCifra 2025

The state's attention to the segment of "smart" solutions for cities makes it one of the most promising and dynamically growing. Accordingly, the presence of free niches opens up wide opportunities for new market players. And an excellent chance to demonstrate your solutions for "smart" cities is participation in a new industry business event - the International Exhibition of Information Technologies and Solutions for Digital Transformation ExpoCifra .

One of the key sections of the exhibition will be "Smart City". Within this section, market participants will be able to present their solutions for the transport complex ("smart" roads, parking, stops and public transport), urban planning and modeling, urban infrastructure (including the digital twin segment), and municipal infrastructure. It is worth noting that 34% of visitors to the IT and digital solutions exposition at the ExpoElectronica 2024 electronics exhibition were interested in the "Smart City" theme .