Smart Cities Need Smart Vendors

Don Dulchinos, president, Smart Home & Away LLC

Don Dulchinos, president,
Smart Home & Away LLC

Pace Quickens as Cities Look for Ways to Improve the Quality of Urban Life

By Don Dulchinos

When I wrote a piece for ScreenPlays three years ago called Smart City – Smart Citizen, there was still a lot of uncertainty about the potential in this space for service providers and solutions suppliers. Today uncertainty is giving way to heavily funded pursuits of opportunities by giant corporations and startups alike in response to the increasing urbanization and “sensorization” of our environment.

Traffic lights, street lights, parking meters, trash receptacles and more are now instrumented and (sporadically) tracked. And while cities were short of money five years ago, still reeling from the crash of 2008 and aftermath, they seem now in better fiscal shape. There may be significant opportunities here for smart vendors in the IoT space, if they position their offerings, well, smartly.

If you ask city residents, of course everyone wants to live in a smart city. Even if they are happy users of apps like Parkmobile, they will tell you they are still waiting for more motivation.

In my view, the new citizen demand driver (pun intended) is mobility.  The new revolution and huge investments in ride sharing, and the forecasted revolution in autonomous vehicles, have seized the attention of city planners.  As cities continue to grow and become denser, traffic reduction is far and away the number one perceived benefit of a smart city.  (Set aside the heretical caveat that, in some sense, planners are throwing up their hands on the proposition that public transit will ever make a dent in traffic.)  And autonomous vehicles, in particular, call for government agreement and coordination around vehicle-to-infrastructure wireless communications – traffic lights, HOV lanes and more.

And so it seems timely to revisit the progress around smart cities.  My neighbors in Denver have been in a growth hotspot in recent years (in no little part due to job creation downtown by cable service providers Comcast, Charter, Liberty Global, and even Shaw Cable.)  Denver’s mayor Michael Hancock has embraced technology having signed a landmark deal in 2015 with Panasonic Enterprise Solutions to become Panasonic’s pilot CityNOW partner, following work that had been done by Panasonic in Japan for the last ten years or so. The initial pilot for Denver CityNOW will be the Aerotropolis, a brand new mixed use development centered on the Pena Boulevard station on the just launched downtown-airport light rail line. (As a side note, Boulder, and some of the quasi-city/tax haven cities who call themselves “Denver South,” have formed a Colorado Smart Cities Alliance. More form than function, the consortium of high-income ring cities doesn’t want to miss the boat, but seems to not yet understand the scale and scope of the larger city’s engagement.)

Panasonic Enterprise Solutions in Denver illustrates a phenomenon, evident three years ago, of large technology players presenting themselves as systems integrators for forward-looking cities. These included IBM’s Smarter Planet initiative, Cisco Smart+Connected Cities, H-P Future City, etc. Often the system integration function overlapped with each company’s Internet of Things strategy, such as Cisco’s Internet of Everything.  All of these efforts lost a little steam as most customers recognized that all devices could be made “smart” but didn’t understand what the benefits might be.

Panasonic’s strategy so far seems to be about creating sales opportunities for its different business interests. These include solar panels for the new housing around Pena Station, an autonomous airport shuttle, and Wi-Fi solutions for mixed use developments nearby. The City of Denver seems to have a fairly broad view of what might be done, but so far all it has to show is a huge Panasonic facility at an otherwise undeveloped site near the rail station.  In these kinds of large systems integration deals, the vendor is actually doing most of the early funding, and right now Panasonic seems to have a vendor lock on the project, which may not be to Denver’s best advantage in the long term. But maybe it’s still early.

The vendor motivation is clear as Panasonic Corp. is certainly going through changes, such as shrinking of its television business.  But it is growing in other areas, such as its battery business (Tesla!) Like many, it is engaged in a struggle with the new generation of systems integrators that are emerging from the digital disruption of recent years – the so-called Stack companies like Apple, Facebook, Amazon, and Google.

For example, Amazon has put forward Alexa as an organizing factor for the many smart home devices that are on sale on Amazon’s marketplace.  I think it more likely the next generation of smart city integration efforts may be presaged by the creation by Google of Sidewalk Labs, now one of the Alphabet companies, which recently announced its own pilot project with the City of Toronto.

Based in NYC, this Alphabet company has some things in common with sister company Nest Labs, which is focused on in-home, connected device product innovation and management.   Two of Sidewalk’s constituent labs are product focused. Semaphore Labs has developed an “adaptive” traffic light using computer vision and sensors to manage vehicle and pedestrian flow through intersections, and Build Labs is exploring innovative building materials, design and fabrication.  The company’s Care Lab is focused on the health care vertical, though concentrating more on better service delivery than on medical devices per se. And Model Labs takes the broadest view – developing tools for community building and data sharing across all stakeholders. One such tool is called Doppelganger, a population simulation tool for planners.

Sidewalk also comprises a number of spinoff portfolio companies. Flow builds digital tools for cities – they have a me-too parking app, but also have a tool for overcoming “siloed understanding of city assets” – that I’d like to see!  Intersection is an urban experience company, “connecting the digital and physical worlds.” Unsurprisingly given their Google parentage, they are brokering advertising partnerships between advertisers and transportation real estate, transit hubs and vehicles. (I guess nothing very innovative about that.)

Intersection is also part of a consortium LinkNYC to replace phone booth real estate with Wi-Fi kiosks. Interesting that a Cablevision exec had told me about this opportunity five years ago, but Qualcomm seems to be the connectivity partner here.  But I’m a little skeptical about information kiosks, which have been around for 20 years and never seem to get much use in my observation.  Like any buzzwords, “smart city” creates an opportunity to repackage old products for new markets.

Overall, Sidewalk occupies an interesting position – not quite a systems integrator like Cisco or Panasonic, but having a hugely broad array of products and services in development. It’s nice to have the cash flow to cover many bets at once.

Sidewalk offers a useful contrast with companies who are selling point solutions to cities. In 2014, CityZenith had an eye-catching data and 3-D visualization tool that was demonstrated at (the late, lamented) INTX Show. They now call it 5-D (adding time lapse and underlying data as extra dimensions.)  CityZenith recently announced participation in a new accelerator called Dreamit Urban Tech.  Dreamit in turn is partnered with Bill Gates and investor Jeff Vinik to work on a huge redevelopment of the Tampa Bay waterfront.

The other Dreamit accelerator participants are listed here to give a sense of the range of subcontracting companies, and applications/products, being sought for these megaprojects (remember, the majority of “accelerator” participants still fail):

  • Cityzenith – sensor data and architecture
  • Ecomedes – data management platform for sustainable purchasing
  • Energy Intelligence  – generates power from cars passing over units embedded in roads
  • Flower Turbines – a micro wind turbine manufacturer
  • Gi Fly – folding electric bicycle
  • Knowify – bid tracking and invoice management software as a service.
  • Lotik – water management and services sensor network.
  • Raxar – a visual assessment and QA software for large infrastructure developments.
  • Twist Home – a super light bulb with W-Fi repeaters and sensors to monitor a building’s environment.

When it comes to the array of point solutions required for any comprehensive smart city approach, connectivity has to rank high. Wireless LTE providers are generally already at the table, with a little head start from providing solutions to commercial/industrial Machine-to-Machine (M2M) sensor networks.  I was intrigued by a recent article from a Pacific Gas and Electric exec proposing the use of utility poles rather than city owned streetlights for connectivity and sensor infrastructure (like the air quality example from Denver mentioned above.)  Because PG&E has a Master License Agreement offering access to “effectively half of California,” it argues they are a more scalable solution for some applications that cross jurisdictions.

The cable service providers have been paying attention as well. Comcast has been steadily growing its Xfinity Wi-Fi shared footprint, but is also investigating a low-power Wide Area Network technology called LoRa, a standards-based Long Range WAN technology using unlicensed spectrum.  Comcast has already launched a business on top of this technology called MachineQ, running in a dozen U.S. cities (including Denver.)  This is more than connectivity – MachineQ layers machine intelligence and analytics onto the data flowing out of devices connected to the LoRa networks.

Comcast cites interest from industries including “healthcare (patient monitoring, laboratory sciences tracking), public utilities (remote utility metering), automotive (asset tracking, telemetry), and smart cities (outdoor lighting, waste management, utility grid monitoring).”  It’s interesting that LoRa was recently integrated into Comcast’s RDK (Reference Design Kit) CPE software stack. This caught my eye as a believer that Comcast and other providers need to extend their smart home/security business outside the home.

Comcast’s IoT push generally has attracted vendor interest, some of which has emerged with launch of an Internet of Things working group by the Society of Cable Telecommunications Engineers (SCTE). The group is drafting use cases around security and home monitoring as you might expect, but has also launched a subcommittee called Smart Cities/Roads (I am serving as the group chairman.)  Smart mobility hubs, car sharing integration, smart street lighting and urban logistics delivery have all surfaced as use cases in that discussion.

Somewhat unexpected leaders in that discussion include long time cable vendors like Alpha Technologies, which has bridged from its CATV powering roots to lines of business that include telecom, mobility, traffic and transportation.  Other traditional cable vendors are diversifying into the smart city world as well.  Cable router provider Netgear recently purchased Placemeter, an “open urban intelligence platform.”  And companies like ESRI, well known for providing cable serviceability mapping via their GIS platform, are also very active in the government services market.

Smart Cities is a growing and largely untapped market. Smart vendors will approach them with point solutions that embed an understanding of the unique context of an increasingly instrumented and actively managed city.

About the Author

As president of Smart Home and Away LLC, Don Dulchinos provides consulting services for developers and providers of Internet of Things applications and services. Dulchinos, a former CableLabs executive, recently served as executive director of the EIDR (Entertainment Identifier Registry), a service created by Hollywood studios, cable companies and digital video providers, including Netflix and Google, to manage assignment and storage of IDs used to track movies and TV programming across all distribution outlets.