July 15, 2024
Smart Cities Market
Ict

Increased Government Investment in Smart Infrastructures to Drive Growth of the Smart Cities Market

The global Smart Cities Market is estimated to be valued at US$ 638.52 Bn in 2023 and is expected to exhibit a CAGR of 15% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:
The smart cities market involves development of infrastructure integrated with information and communication technology and internet of things solutions to efficiently manage assets and resources within a city. This enables collection and analysis of large amounts of data to improve operations across various functions including transportation, energy, utilities, and others. Smart cities offer benefits such as reduced traffic congestion, lower carbon footprint, improved living standards, and optimized resource allocation through digitization of services. There is growing need for smarter infrastructure to tackle issues around rapid urbanization, traffic management, and environmental sustainability.

Market key trends:
One of the key trends in the smart cities market is rising focus of governments globally on developing smart infrastructure. Government initiatives are playing a major role in modernizing cities with digital solutions. For instance, in 2018, the Indian government announced a budget of $30 billion for 100 smart cities project. Similarly, China has invested billions of dollars under its smart cities program. Growing government investments is a major factor driving the adoption of IoT, cloud, and other smart solutions across various smart city functions. Other trends include increasing deployment of autonomous vehicles, 5G rollout to support IoT connectivity, and adoption of artificial intelligence for advanced data analytics.
Porter’s Analysis
Threat of new entrants: The smart cities market requires huge investment in infrastructure modernization and high technology adoption which makes entry difficult for new players.
Bargaining power of buyers: City administrations have strong bargaining power as they handle large projects and can choose between different technology providers.
Bargaining power of suppliers: Key technology providers like telecom and software companies enjoy strong bargaining power given the specialized skills and solutions they provide.
Threat of new substitutes: Alternatives like improved regular cities or adoption of new emerging technologies can pose potential threat to demand for existing smart city solutions.
Competitive rivalry: The market has presence of global technology giants competing intensely on the basis of product features, pricing and service offerings.

Key Takeaways
The global Smart Cities Market Share is expected to witness high growth, exhibiting CAGR of 15.% over the forecast period, due to increasing urbanization and focus of governments worldwide on enhancing citizen services through digitization and analytics.

Regional analysis: North America dominated the smart cities market in 2023 with a share of over 35%, owing to large-scale investments by both public and private agencies in the US and Canada. Asia Pacific is anticipated to grow at the fastest pace during the forecast period, led by countries like China, India and Japan undergoing rapid modernization and digitization of urban infrastructure.

Key players operating in the smart cities market include Microsoft Corporation, Toshiba Corporation, AT&T, Inc., SAP SE, Cisco Systems, Inc., Philips Lighting, Ericsson, Huawei Technologies Co., Ltd., Panasonic Corporation, General Electric, Oracle Corporation, Hitachi Data Systems Corporation, and IBM. Key players are focusing on integrative smart solutions around IoT, cloud and analytics to gain competitive edge

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it