Smart Cities: Investing in the Internet of Everything
As the number of connected devices across the globe explodes, more devices are getting interconnected into the global Internet of Things (IoT) that is transforming the way we live and work. By 2018, there will be over 10 billion mobile-connected devices on Earth—a $14.4 trillion global opportunity for the private sector as well as a $4.6 trillion opportunity for the public sector over the next decade.
Internet of Everything (IoE) is the evolution of IoT—an ecosystem where people, processes and things are interconnected to each other and to the Internet in billions, even trillions of novel ways that enable our future societies, communities and cities. Context awareness, massive processing power and energy independence will propel the use of this “network of networks” in unprecedented ways.
Is Your City Ready for IoE?
As microcosms of the interconnected networks that make up IoE, cities serve as fertile ground for realizing their value. Opportunities for cities may exist in city-level concerns such as building management and efficient traffic flow, besides better provisioning of public services such as street lighting, waste management and policing.
Cisco has been working with cities around the world such as Amsterdam, New York and Busan (South Korea) to address key priorities and develop enhanced experiences and utilities for the people, organizations and processes of these cities. The Westergasfabriek zone of Amsterdam, for example, is a test-bed for the city where Cisco and lighting giant Philips are developing an on-demand, service-based provision of networked lighting and media content. The impact of this initiative is tremendous; it has opened the door for new revenue-generation opportunities and public-private business models for networked civic services.
Cities have to rethink almost every facet of the way they operate, to determine how they will benefit from IoE. By moving to an IoE-centric way of doing things, they stand to benefit through improved asset utilization, higher employee productivity, more efficient supply chain and logistics, and better customer experience for their citizens and innovation.
The biggest risk cities face while doing this realignment is to focus on only one piece of the puzzle, failing to understand and address the big picture. City leaders must understand that the various components that make up the IoE—people, process, data and things—each have a specific role to play within the whole. Each must work harmoniously with the others to deliver benefits for future cities and communities. Once this is clear, city planners can invite public and private sector players to leverage the manifest opportunities in their city presented by IoE. Public sector enterprises may be invited, for example, to offer cities improved building management, water or waste management or even services such as better-managed street lighting.
Cisco’s initiatives and pilots with various cities worldwide highlight the immense opportunities IoE offers to private companies, both big and small. For instance, in New York, City24/7—a company committed to making public communications more accessible to everyone, everywhere—in collaboration with Cisco and the City of New York has launched an interactive platform that integrates information from open government programs, local businesses, and citizens to provide meaningful and powerful knowledge anytime, anywhere, on any device.
Enterprises Worldwide Are Feeling the Impact
Most organizations need to make sizeable investments to ensure their IT infrastructure is prepared to take advantage of this huge opportunity. Companies must acquire the newest technologies and infrastructure such as cloud and mobile computing, as well as big data, to ensure that they are ready to participate in the IoT economy and capitalize on the opportunities it presents.
Businesses can employ a variety of strategies to plan for such large-scale investments in technology, one of them being partnering with captive finance companies that are uniquely positioned to help enterprises prepare for IoT and later for IoE. These entities can help cities to maximize their investments and enable them to transform every facet of their operations.
How are they able to do this? Captive finance companies (or ‘captives’) better understand the products, services and solutions being offered by the parent technology vendor, and use this knowledge to create specially tailored financing solutions for organizations that can help them leverage all the benefits of the emerging IoE economy.
Why Finance with a Captive?
Kristine A. Snow, President of Cisco Capital, explains that captives specialize in and have a unique understanding of the solutions being offered. They can more easily tailor financing based on how each technology is usually deployed and consumed as they have the ‘insider’ knowledge from their parent companies.
“(Captives) even (allow) organizations to defer payments until the technology is fully operational and provide value to the business, ensuring that customers are realizing the maximum benefit of their solution and the greatest return on their investment,” she adds.
Choosing the right technology during the transition to an IoE-based ecosystem can be critical. By financing the solution, the authorities can preserve cash for reinvesting in the city, and adopt new technologies faster. The RoI can be accelerated as well when cash outlay is aligned to solution implementation and revenue stream generation. The cherry on the pie: Captives provide a “green” way for cities to dispose of unwanted/unused assets during the technology refresh.
By leveraging the many benefits of financing their technology revamp via a captive finance organization, ‘smart’ cities are best positioned to offer their citizens all the benefits offered by IoE.
To know more about Cisco’s take on IoE, visit http://internetofeverything.cisco.com/