A report based in Smart Transportation, Smart Buildings, Smart Utilities, Smart Citizen Services (Public Safety, Smart Healthcare, Smart Education, Smart Street Lighting, and E-Governance), and Region - Global Forecast to 2026
The global Smart Cities Market size to grow from USD 457.0 billion in 2021 to USD 873.7 billion by 2026, at a Compound Annual Growth Rate (CAGR) of 13.8% during the forecast period. Growing urbanization, need for efficient management and utilization of resources, demand for fast and efficient transport and commuting, public safety concerns, and increasing demand for a healthy environment with efficient energy consumption are expected to be the major factors driving the growth of the Smart Cities Market.
Smart Cities Market Dynamics
Driver: Increasing demand for a healthy environment with efficient energy consumption
The reduction in energy consumption and concern over the proliferation of environmental wastes are major driving factors for the adoption of smart city solutions. Increasing concerns over global warming and ozone depletion have accelerated the efforts of governments of developed and developing countries to control their carbon footprint, with governments imposing stricter regulations to limit emissions. The implementation of intelligent infrastructure automation, smart grids, and controlling systems contribute significantly to reducing power consumption and carbon emissions, which minimizes losses and optimizes operations.
Restraint: High cost of implementation
Economies having a tight budget are not able to implement smart city solutions due to the cost of deploying these systems. Integrating major functions such as big data analytics involves significant design, coding, testing, and documentation tasks. The cost incurred in the transformation of the existing infrastructure acts as a deterrent for governments to continue large-scale investments. Though smarter infrastructure helps reduce the operating costs and increase energy efficiency, the initial costs required pose a major barrier.
Opportunity: Rise of 5G to accelerate the adoption of smart city solutions
The rise of 5G technology has brought major changes to the cloud computing world. The low latency connectivity provided by 5G enables smoother communications and faster data transfers. 5G enables quick access to video analytics and AI that makes the city a safer place. This enables city managers, building owners, and facility managers to make informed decisions and provide intelligent public services. The evolution of 5G is yet to realize its full transformational potential and provides a great growth opportunity for the smart cities market.
Challenge: Lack of knowledge among people about smart cities
In many countries, it is observed that a very small part of the population is aware of the term “smart cities,” of which many do not know about government plans, implementations, and benefits of smart cities. This lack of awareness among people is an important factor for the slow development of smart cities, as this causes ignorance about smart city projects and lowers the level of impetus by the government to implement smart solutions for cities.
By Smart Utilities services, the Infrastructure Monitoring and Management service to have the highest growth during the forecast period
The Infrastructure Monitoring and Management service of the Smart Utilities segment is expected to have the highest growth rate during the forecast period. Infrastructure monitoring and management services allow utility companies to deliver critical services securely and reliably to thousands of customers, irrespective of their location. By adopting this service, a utility company can keep an eye on all its assets and protect them from theft or damage using the mobile workforce and surveillance systems. The service provides high-precision information of the entire infrastructure in real-time, regardless of the environmental conditions.
By Smart Transportation services, the Deployment and Integration service to dominate the market during the forecast period
The Deployment and Integration service to have the highest share of the Smart Transportation Services market. Deployment and integration services involved in the smart transportation industry perform designing, engineering, and customized product development as per the needs of users. The deployment and integration service providers help end users integrate smart infrastructure solutions with their existing infrastructure and save costs by reducing the deployment time of solutions.
By Region, APAC to record the highest growth during the forecast period
The APAC Smart Cities Market is estimated to have strong growth in the future. Government initiatives to promote the digital infrastructure are responsible for driving the adoption of smart city solutions in the region. APAC is expected to be the fastest-growing market owing to the rapid economic developments, globalization, digitalization, and the increased proliferation of smartphones. Major vendors such as ZTE, Huawei, and NEC Corporation have already invested huge amounts in telecom infrastructure, and this spending is expected to increase. Due to the large number of 5G deployments and initiatives taken by major Asian mobile operators to resolve the problem of high bandwidth requirement, the smart cities market in APAC is expected to have enormous growth in the coming years.
Key Market Players
The report includes the study of key players offering Smart City solutions and services. It profiles major vendors in the global Smart Cities Market. The major vendors in the Smart Cities Market include Siemens (Germany), Cisco (US), Hitachi (Japan), IBM (US), Microsoft (US), Schneider Electric (France), Huawei (China), Intel (US), NEC (Japan), and ABB (Switzerland). These players have adopted various strategies to grow in the global Smart Cities Market.
The study includes an in-depth competitive analysis of these key players in the Smart Cities Market with their company profiles, recent developments, and key market strategies.
To know about the assumptions considered for the study, Request for Free Sample Report