Spending on smart city applications, including resilient energy and infrastructure as well as data-driven public safety and intelligent transportation, will reach $189.5 billion by 2023, according to a new smart cities spending forecast from International Data Corporation (IDC).The leading priorities for the investments will be smart grid, fixed visual surveillance, advanced public transportation, smart outdoor lighting, and intelligent traffic management, which will account for more than half of all smart cities spending this year, although other projects will have increasing priorities by the end of the forecast. According to IDC, the use cases that will see the fastest spending growth over the next five years are vehicle-to-everything (V2X) connectivity, digital twin and officer wearables.
IDC said that it expects Singapore to remain the top investor in smart cities initiatives, primarily due to the Virtual Singapore project. Singapore will be followed by New York City, Tokyo and London, respectively. Beijing and Shanghai were essentially tied for the fifth position. Spending in all these cities is expected to surpass the $1 billion mark in 2020.
On a regional basis, the United States, Western Europe, and China will account for more than 70% of all smart cities spending throughout the next five years. Japan and the Middle East and Africa (MEA) will experience the fastest growth in smart cities spending with CAGRs of around 21%
“Although smart grid and smart meter investments still represent a large share of spending within smart cities, we see much stronger growth in other areas, related to intelligent transportation and data-driven public safety, as well as platform-related use cases and digital twin, which are increasingly implemented at the core of smart cities projects globally,” said Serena Da Rold, program manager in IDC’s Customer Insights & Analysis group, in a prepared statement.