Are smart cities empty hype?

The Economist has been exploring the promise of smart cities along with two very different approaches: a top down approach championed by large technology firms and a bottom up approach championed by those in favor of smaller, grass roots efforts.

Dear Sir

The closing remarks highlight important differences in the definition of smartness. For Anthony Townsend, smartness is resilience in the face of human or natural disasters but also the single point of failure or in some cases, a single point of transaction fee, because private firms control important pieces of a smart city technology stack. On the other hand Wladawsky-Berger is more focused on the promise of big data and data science. They are not unrelated, but they will no doubt value different architectures and stakeholders.

Part of the challenge with smart city discussions, is that it misses elements of smartness. For example, in the mobility space we are witnessing an explosion of options from ride-sharing, to cab hailing. Moving around a large global city today likely means a choice between using an app to call a cab or perhaps a shared car or receiving realtime guidance on the best available combination of human powered and public funded transport options. This explosion of choices, provided by a mix of startups, global technology firms, automotive firms and public transit agencies provides a tangible example of the bottom-up smartness, where different solutions are battling to be picked by individual citizens as they use their own command centers, their smartphones.

And mobility also raises some interesting questions about a data science centric view. Firms like Waze and Google have asked us to contribute data about our locations and velocities so that they may understanding prevailing traffic conditions. They are building on many layers of stakeholders from mobile operators to handset vendors, but they are making use of existing sensors and importantly, citizens. Contrast Waze with something like congestion pricing systems, that deploy and operate, at great expense, dedicated infrastructure. Do we have a good understanding of the relative performance of these two approaches? Does big data impy big dedicated infrastructure? Perhaps this is worthy of some debate.

Certainly smartness is about much more than mobility. But it presents an interesting conundrum. Why has mobility attracted so much interest from entrepreneurs and early stage investors, while other smart city areas have seen less interest? Part of the challenge are long sales cycles or the process of acquiring solutions. Long sales cycles add additional risk for startups as they and their investors are usually focused on rapidly scaling in ways that let them capture marketshare and make it tough for incumbents to respond. But even before the procurement process,  startups have often had a hard time just reaching a point where they can test new ideas with multiple cities so they are able to produce solutions that will be valuation to many more cities.

But this is changing. City organizations like New Urban Mechanics or not-for-profits like Code for America are providing new ways for startups to work with cities. These organizations are having an impact, as a recent report from the Knight Foundation shows. Investment in civic innovation is increasing year over year in recent years across corporates, foundations and importantly angel investors and institutions venture firms too. The startups are coming. Which means cities will get to test more ideas, quickly and cheaply. This seems like a smart way to make cities smarter.

See the full debate on the Economist.