NEW YORK, July 15, 2024 /PRNewswire/ -- The global smart city market size is estimated to grow by USD 345.8 billion from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of  24.81%  during the forecast period. Increase in IT consolidation and modernization is driving market growth, with a trend towards proliferation of smart city projects in emerging economies. However, high cost of upgrading smart grids  poses a challenge. Key market players include ABB Ltd., Accenture Plc, Aeris Communications Inc., Alphabet Inc., Cisco Systems Inc., General Electric Co., Hewlett Packard Enterprise Co., Hitachi Ltd., Honeywell International Inc., Huawei Technologies Co. Ltd., International Business Machines Corp., Itron Inc., LG Electronics Inc., Microsoft Corp., Oracle Corp., SAP SE, Schneider Electric SE, Siemens AG, Semtech Corp., and Signify NV.

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Market Driver

Developed economies in North America and Europe have been leading the way in smart city development for over a decade, implementing numerous projects. The Asia-Pacific region is currently the fastest-growing market for smart city technologies, driven by urban population growth and infrastructure development in emerging countries. India and China are among the key players in this region, with the Indian government announcing smart city projects in 100 cities and China building 500. ASEAN's Smart Cities Network is also working on sustainable urban development in 26 cities by 2025. The rapid urbanization in countries like India necessitates the roll-out of smart city projects, enabling faster responses from end-users such as government agencies, healthcare, and transportation providers. The generation of vast amounts of data from smart devices in these cities requires analysis to enhance business quality and innovate for a better future with faster connectivity. Consequently, the growth of smart cities in emerging economies is expected to significantly impact the market during the forecast period. 

Smart City Market is witnessing significant growth due to the integration of advanced technologies for environmental sustainability and resource management. Key trends include the use of smart city technologies for environmental monitoring, traffic safety, and public safety. Solutions like facial recognition, data-driven policing, and gunshot detection sensors are enhancing crime-fighting capabilities. Energy savings and long-term cost savings are major functions of smart city solutions, addressing tight budgets. Cities like Amsterdam and Chengdu are leading the way with large-scale investments and government backing. Integration of video cameras, gunshot detection sensors, and public safety officials with rapid response times is crucial. Software integration, networking, and big data analytics are essential for cost-effective systems, but integration complexities remain a challenge. Existing infrastructure and urban sources are being leveraged to reduce operational and maintenance costs. Traffic signal management, emergency response protocols, and law enforcement responses are being optimized through intelligent surveillance and home security systems. 

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Market Challenges

• The global smart city market may experience hindrances in growth due to the substantial costs associated with upgrading power grids for compatibility with smart grid data management solutions. These costs encompass additional investments in distribution systems, transmission line replacements, power delivery systems, substation digitalization, and digital controls. Power utilities and independent power producers face substantial initial capital investments as a result. The aging power infrastructure of these utilities, coupled with the growing need for renewable power grid integration, will escalate their grid renovation budgets in the upcoming years. This reluctance to upgrade power grids, due to high costs, poses a significant barrier to the adoption of smart grid data management solutions. According to the US Department of Energy, US-based power utility companies are projected to spend approximately USD3.5 billion annually between 2018 and 2030 on grid modernization projects.
• In the digital era, Smart Cities present transformative potential for addressing challenges such as commute times and smart grid efficiency. Business leaders recognize the market's transformative potential, driving innovative business models in areas like digitalization, connectivity, and sustainable urban development. However, cybersecurity and data stewardship are crucial concerns, with ownership, interoperability, cross-border portability, and metrics key to success. The Smart City Market encompasses various sectors, including healthcare. Smart Healthcare Solutions offer improvements in patient care delivery through advanced metering solutions, telecommunications infrastructure, and novel technologies. Utilities-related information, such as smart metering data, is crucial for centralized hubs, requiring IT integration and a unified repository for billing processes and revenue assurance. Network operators and care providers must ensure data security and privacy while analyzing losses, planning capacity, and engaging consumers. In the Smart Healthcare Market, caregivers, patients, and healthcare organizations benefit from advanced solutions, improving the modern healthcare landscape. Novel technologies, like cloud edge computing and network slicing, are essential for urban management, enhancing the overall Smart City experience. The Smart City Market's success relies on the collaboration of various stakeholders, including businesses, governments, and communities, to create a sustainable future.

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Segment Overview 

This smart city market report extensively covers market segmentation by  

1. Application 
   • 1.1 Smart infrastructure
   • 1.2 Smart energy
   • 1.3 Smart mobility
   • 1.4 Smart security
   • 1.5 Others
2. Component 
   • 2.1 Hardware
   • 2.2 Software
   • 2.3 Services
3. Geography 
   • 3.1 Europe
   • 3.2 North America
   • 3.3 APAC
   • 3.4 South America
   • 3.5 Middle East and Africa

1.1 Smart infrastructure-  The Smart City Market refers to the growing industry of developing and implementing technology-driven solutions for urban areas. This market encompasses various sectors such as energy management, transportation, public safety, and waste management. Companies provide innovative products and services to enhance city infrastructure, improve efficiency, and provide better quality of life for residents. Smart City solutions include sensors, IoT devices, and data analytics to optimize resource usage and address urban challenges. This market is expected to expand significantly due to increasing urbanization and government investments.

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The global Smart City Information and Communication Technologies (ICT) Infrastructure market is experiencing rapid growth, driven by urbanization and the need for efficient city management. The Smart City Platform market is expanding as cities adopt integrated solutions for data collection, analysis, and management to enhance urban living. Similarly, the Smart City Communication market is booming, focusing on reliable connectivity and advanced communication systems to support smart city operations. Key players are investing in innovative technologies to meet the rising demand for smarter, sustainable urban environments.

Research Analysis

Smart City Market: Transforming Urban Spaces with Environmental Sustainability and Technological Innovation Smart City Market is revolutionizing urban living by integrating advanced technologies to enhance resource management, environmental monitoring, and public safety. Environmental sustainability is at the core of these solutions, which utilize smart city technologies to optimize energy usage, reduce waste, and minimize carbon footprints. Resource management systems monitor and analyze urban sources in real-time, ensuring efficient use of resources. Environmental monitoring solutions employ sensors, facial recognition, and video cameras to assess air quality, noise levels, and crowd management. Public safety is prioritized with data-driven policing, traffic safety systems, gunshot detection sensors, and drones for rapid response. Cost-effective systems offer long-term savings and seamless integration with existing infrastructure. Cities like Amsterdam and Chengdu are leading the way with large-scale investments and government backing. However, integration complexities must be addressed to ensure access to AI capabilities, real-time data analysis, and quick emergency response protocols. Ultimately, these smart city solutions prioritize citizens' safety and well-being while minimizing urban challenges.

Market Research Overview

In the digital era, Smart City Market is revolutionizing urban living by integrating environmental sustainability with advanced technologies. Resource management and environmental monitoring are major functions, with solutions including facial recognition for public safety and surveillance. Smart city technologies are transforming traffic safety through data-driven policing, emergency response protocols, and crime-fighting capabilities. First responders and call centers utilize real-time data for efficient field operations. Traffic signal management and emergency vehicle prioritization optimize urban sources, reducing crime rates and energy savings. Big data analytics, networking, and software integration facilitate cost-effective systems, balancing long-term cost savings with tight budgets. Existing infrastructure in cities like Amsterdam and Chengdu is being enhanced through government backing, incorporating gunshot detection sensors, video cameras, drones, and AI access. Smart city initiatives prioritize cybersecurity and data stewardship, ensuring interoperability and cross-border portability. Innovative business models and digitalization are modernizing sectors like healthcare, with smart healthcare solutions streamlining patient care delivery and caregiving.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Application
• • Smart Infrastructure
  • Smart Energy
  • Smart Mobility
  • Smart Security
  • Others
• Component
• • Hardware
  • Software
  • Services
• Geography
• • Europe
  • North America
  • APAC
  • South America
  • Middle East And Africa

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

About Technavio

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With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

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SOURCE Technavio