While many organizations struggle to get return on investment from smart city projects, those that have found success say that an incremental approach works best. One of the chief lessons learned from these successes? Run IoT pilots.
Internet of Things (IoT) devices are connected to the Internet and gather data from their environment, then transmit this data to other applications for analysis and, ultimately, business decision making. Organizations see immense potential for this data to help them reduce costs, boost efficiency, or offer new products and services.
According to a Cisco study, nearly 50% of respondents have used IoT data to improve product quality or performance and to improve their business decision making. But despite these seemingly positive numbers, 60% of 1,300 respondents say that IoT projects may look good on paper but can unravel in reality given their complexity. And only 26% of those projects successfully emerge from the pilot phase.
“You have to eat the elephant one bite at a time,” said Lee Farrell, manager of frontline services for the city of Ottawa, in a panel discussion on smart city projects at the IoT World 2018 conference.
“Identify the high-value use cases to quickly demonstrate that value to gain support, to gain champions,” Farrell said.
San Mateo County knows the value of an incremental approach to smart city projects, and IoT projects specifically. Comprising 22 cities and an unincorporated region outside San Francisco, the county has paved the way for IoT via other smart city initiatives.
San Mateo County's first step was to build public Wi-Fi access in underserved areas. “There are a lot of pockets that are rural, they’re on the coast and they lack connectivity,” said Ulysses Vinson, chief smart communities officer in San Mateo County. “We’re putting 72 public Wi-Fi spots throughout the county and sharing fiber with our city partners,” he said.
Extending Wi-Fi brought goodwill and paved the way for the county to embrace IoT. San Mateo launched the SMC Labs project to investigate areas of need in San Mateo County and to run IoT pilot projects. The goal is to explore, based on the data it aggregates, where the county can get the most ROI from IoT projects. San Mateo has several pilot projects running, including those to explore trash pickup, water conservation and parking availability for electric vehicles.
“We’re connecting people on this track [with public Wi-Fi],” Vinson said, “but now also connecting things to make government more efficient and give a better quality of life as people navigate government services.”
“San Mateo creates that multiplier effect,” said Dan Evans, a panelist and senior director of product management at Itron, an energy and water management company. “All cities in the county can kick the tires and figure out whether these projects are a good fit for them or not. And if not, then they learn that with minimal investment without being in the middle of a deployment,” Evans said.
Farrell of the city of Ottawa said that pilots also create a virtuous cycle, generating initial data and evidence of ROI, and enabling cities to then go back to ask for additional budget. That requires having a clear idea of the data to gather.
“One thing is knowing what you’re going to measure and how are you going to demonstrate that benefit,” Farrell said. “You’re going to need to ask for money to do this. If you run pilots and they are successful, you need to be able to demonstrate that value,” he said.
Bob Bennett, chief innovation officer for Kansas City, Mo., said that encouraging innovation is the cornerstone of the city’s IoT strategy by focusing on great ideas, not technology.
The city’s Innovation Partnership Program opens up the city to three-month pilot projects developed by startups. New companies pitch their ideas, receive a city departmental sponsor, and run trials of their products for a quarter.
At the end of the pilot period, a startup doesn’t get paid for its great idea, but it can list the city as a client. If the department likes the product or service, there is an accelerated procurement policy process to bring the idea to fruition using departmental funds.
One project idea that gained traction in Kansas City was DogSpot (formerly Dog Parker), a smart doghouse located on city streets that can be rented for 30 cents a minute. The temperature-controlled, safe environment allows owners to stash their pets in a doghouse, then go to yoga or get a cup of coffee, leaving the pet securely inside. Kansas City and members of Bob Bennett’s team saw an opportunity to bring in technology that could spur economic development, which is how the team pitched the project.
The budget request isn’t for smart city funds, Bennett said. “It’s [slated as] economic development.”
Bennett noted that companies that come in showcasing technology that doesn't directly address a problem are quickly dismissed.
“You have to use that technology to solve a people problem first,” Bennett said. “Anybody that comes to us with a technology solution for technology’s sake, we’re done. The conversation lasts about 30 seconds, and that is not going to move forward.”
All members of the panel noted that budget is always an issue for government entities that want to start IoT projects. According to industry observers, the governmental policy environment can make or break IoT projects and smart city initiatives. European regional governments, for example, have been more likely than the U.S. government to allocate smart city resources to projects.
“There are mandates—federal or provincial or others—that provide funds, provide expertise and lab environments that, at least in the early stages, are accelerating these technologies,” said Mobeen Kahn, IoT assistant vice president of IoT strategy at AT&T.
“We’ve seen that in UAE [United Arab Emirates], China and Europe. It helps. We have our way of doing things in the United States. We let our market systems work here, but, in the initial stages, we’re seeing better traction for these reasons,” Kahn said.
In November 2017, Cisco introduced the introduced the City Infrastructure Financing Acceleration Program to help cities find funding for smart city initiatives. Cisco pledged $1 billion to help cities accelerate and ease the journey for smart city initaitives.
Bennett said that while incremental change enables governments to stay nimble, it still requires commitment and long-term vision.
“My kids just expect the city to be connected and that everything they do is right here on their phones: paying their water bill to renewing a business license,” Bennett said. “But this takes time. This is going to be a long haul.”
Lauren Horwitz is the managing editor of Cisco.com, where she covers the IT infrastructure market and develops content strategy. Previously, Horwitz was a senior executive editor in the Business Applications and Architecture group at TechTarget;, a senior editor at Cutter Consortium, an IT research firm; and an editor at the American Prospect, a political journal. She has received awards from American Society of Business Publication Editors (ASBPE), a min Best of the Web award and the Kimmerling Prize for best graduate paper for her editing work on the journal article "The Fluid Jurisprudence of Israel's Emergency Powers.”