Go Back

The smart city opportunity for telcos


28 June 2023

Circles Blog Article - The smart city opportunity for telcos

As urbanisation accelerates globally, smart cities offer solutions to resource challenges, creating significant opportunities for telecom companies in connectivity, analytics, and IoT integration.

Cities worldwide are on an inexorable growth trajectory, thus presenting numerous challenges. With burgeoning demands outpacing the available resources, urban planning will gain pivotal importance.

The United Nations projected that two-thirds of the global population will be living in cities by 2050, and at least 40 megacities will have a population of 10 million or more. Cities occupy less than 1% of the world’s land surface, but they use up to 75% of the world’s natural resources. For urban leaders aspiring to sustain liveable cities, tough decisions will be imperative. One promising solution lies in the integration of technology, transitioning conventional cities into smart cities.

To better serve their residents and businesses, smart cities need to harness digital technology to enhance the efficacy of traditional networks and services. Leveraging smart technologies and data analytics, a smart city’s primary objective is to optimise city operations, foster economic growth, improve residents’ quality of life, and conserve resources. Such initiatives include the modernisation of more advanced water supply and waste disposal systems, smarter urban transportation networks, and more effective building lighting and heating systems.

Smart cities, a multibillion-dollar opportunity

According to Grand View Research, a market research company, the global smart cities market size was valued at USD 1,226.9 billion in 2022 and is expected to register a compound annual growth rate (CAGR) of 25.8% from 2023 to 2030. This means the market size of the industry is estimated at USD 6,965.02 billion in 2030. With connectivity forming the core of a smart city, this market trend offers substantial growth opportunities for telecom players.

Telcos are set to play a pivotal role in this burgeoning multibillion-dollar sector, which leverages new digital service layers within smart cities. The network infrastructure collectively owned by telcos is ideally suited to delivering digital urban services to future generations. In certain markets, they are optimally positioned to offer end-to-end services directly to customers, alongside the technical platform necessary for future service delivery. Beyond technological capabilities, orchestrating diverse ecosystems is a critical requirement, a task telcos are ideally equipped to undertake.

4 competitive advantages that are unique to telcos

Telecom operators are well positioned to accelerate the emergence of smart cities, applying their established expertise to expedite this urban progression. There are readily attainable opportunities these firms can seize. However, it’s crucial for them to innovate and adapt if they aspire to unlock the full potential of this landscape. This transformative journey can be a reality if telcos successfully navigate these four aspects:

  • Notably, they are significantly advanced in data management, control existing network infrastructure and platforms, and have expertise in managing public-private collaborations.
  • Besides providing high-speed connectivity – a fundamental requirement for smart cities –, telcos can expand into adjacent service domains, such as analytics, cloud, and mobility.
  • Owing to a range of key competencies, telcos are well-placed to branch into related sectors and offer data and cloud-related services to local authorities. These competencies encompass solid customer billing relationships, a substantial retail presence, and significant brand equity.
  • Additionally, telcos are well-positioned to penetrate the big data analytics market. They sit on an abundance of valuable data, and their ability to gather and integrate vast volumes of data from heterogeneous sensor networks, creating intelligent data sets, is a valuable asset. They can leverage this skill to broaden their suite of smart city offerings.

For the Internet of Things (IoT) plans to be successfully implemented, broader services offered by telco companies are vital and crucial, especially in initiatives involving smart buildings and smart cities. The fact that no one stakeholder or organisation can dominate this market is becoming increasingly clear, and telcos should be seen as the glue that binds the ecosystem’s many players together.

This article was originally published by Marcel Benjamin Tabin on LinkedIn. Like what you read? Follow us for more news and insights from Circles.


Your enquiry was submitted and will be responded to as soon as possible.



Your enquiry wasn’t submitted due to an error. Please try again