Smart Cities has become a hotter technology area in the past couple of years, and it’s expected to fuel a major increase in deployment of sensors and edge computing, provide intelligent operations, maximize safety, and enhance resident benefits.
Yet for all its promise, the roll out of smart cities technologies has been quite limited, with only a small portion of cities actually adopting the technology in anything beyond a proof-of-concept stage. There are multiple reasons for this, but the biggest reason is that deploying any smart cities technology is highly complex and takes many resources of people and funds. Adding physical infrastructure (e.g., upgrading light poles, deploying sensors, adding optical fiber) is difficult for cities to do. With all the fiscal and personnel constraints placed on most cities today, the ability to apply the needed resources is extremely difficult.
Smart cities as a service
To accelerate the needed upgrades, what’s needed is a different approach than leaving each city to its own devices. Rather, working with companies that can deploy smart cities as a service, selecting the proper technology and installing it, and relieving the municipality of doing much to the upfront technological work to conserve resources is becoming an attractive option. It also helps leverage the expertise companies have gained in deploying smart cities tech, as many components of any overall solution can be duplicated from city to city.
By not just selling technology but offering a turnkey solution and managing the operation of that solution, which enables moving the ongoing operations from a capex model to an opex model, can make it much more attractive to cities while also shortening the time to deployment and time to benefits.
Qualcomm looks to monetize smart cities as a service
Qualcomm recently hosted its annual Smart Cities Accelerate event in San Diego, where it discussed a number of its targeted technologies for IoT and Edge computing, and specifically how Qualcomm and its partners are targeting the potentially huge Smart Cities market. What went under- reported in my opinion is the change in business model that Qualcomm is implementing to accelerate Smart Cities installations. Essentially Qualcomm, in partnership with its large ecosystem of device makers, software providers and system integrators, is offering to take the lead in creating a smart city, managing that smart city, and maintaining the upgrades and security of those deployments.
As Qualcomm moves into new market areas beyond the chips and mobile technology it is primarily known for, it is exploring a number of “as a service” offerings that could propel it to be a leading provider in select markets. This “Smart Cities as a Service” offering is a major new business focus. Qualcomm gets involved at the start of the project (at the definition phase) and works all the way through implementation and into the ongoing operations phases.
While this is a departure from Qualcomm’s traditional business model, the accumulated expertise that Qualcomm has amassed over the years in hardware, software, connectivity and integration puts it in a perfect position to become a trusted partner for many cities that do not have the expertise or the manpower to implement their own custom solution. Indeed, few cities have the massive resources needed to fully implement their own customized smart cities projects and must rely on partners to provide such services. This “Have” vs. “Have Not” classification for cities that have the wherewithal to go it alone versus those that don’t is much less distinct when you are talking about as-a-service models. However, it still takes a vision of the future offerings and a major commitment by the municipality to make this a reality. In fact, one of Qualcomm’s key attributes to deciding who to work with is the level of city government commitment to make the project successful.
Long term benefits for Qualcomm
By working up front to define a solution, then deploying and running that solution, Qualcomm can learn much about what’s needed in the field, and then leverage that knowledge by feeding it back to the engineering groups as they design new SoCs and peripheral components. Indeed, as part of this service, Qualcomm has created a large assortment of management and information discovery software that is used in the operations “command center.” This requires a significant investment in time and resources, but much of the creative work has been done by implementing needed components selectively to meet Qualcomm’s own internal needs (e.g., traffic monitoring, waste management, security enhancements, AI based video detection, anomaly detection, etc.). While Smart Cities as a Service is a first effort, we believe that Qualcomm intends to leverage this capability for other vertical industries it has in its sights. Indeed, it mentions 30 vertical solution areas it is working on, although none are at the stage of the smart cities offering. And as it builds out its ecosystem of partners, it enhances both the technology it offers as well as the attractiveness of working with Qualcomm for both the end user and partner organizations. This represents a long-term advantage.
Bottom line
Qualcomm can substantially disrupt the current market for Smart Cities implementations with its innovative Smart Cities as a Service approach. What’s hampered deployments is the lack of expertise and resources that most municipalities have access to. By leveraging both the expertise and the “learnings” that Qualcomm has through implementing multiple smart cities projects, it can substantially reduce both the degree of difficulty and time to market for such solutions.
Coupled with the ability to leverage the expertise it gathers across verticals, as well as feeding back select implementation requirements to its engineering groups, Qualcomm stands to gain benefits both in the new business model, as well as gain competitive advantage in its core components – a Win-Win for Qualcomm, as well as for the many cities it works with.
Jack Gold is founder and principal analyst at J. Gold Associates, LLC., an information technology analyst firm based in Northborough, Massachusetts. He has more than 25 years of experience as an analyst and covers the many aspects of business and consumer computing and emerging technologies. He works with many companies. Follow Jack on Twitter and on LinkedIn.