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Perspectives

Telecoms and Smart Cities: Moving Up the Value Chain for Humanity and New Opportunities

2020-06-16


Telecoms are playing a front-line role in the smart city movement. But to best support post-coronavirus urban needs, such as enabling more real-time healthcare, they must aggressively push beyond their current infrastructure ambitions.

Today, 55% of the world’s population lives in urban areas, and before COVID-19 hit, the United Nations expected that proportion to hit 68% by 2050. While it’s too early to know with any certainty, the pandemic may have a long-lasting impact on business and consumer attitudes toward densely packed cities. Regardless, we believe the “smart city” movement grows even more vital in the face of the coronavirus pandemic, as urban leaders will face demands to control movement, monitor myriad parameters, identify emerging hotspots, and allocate healthcare intelligently.

Smart-city technology has proved its mettle during the pandemic. Municipalities can use smart thermal sensors to identify existing hotspots, predict emerging ones, and take concerted action by orchestrating other agencies. Such tools have already helped the cause. For example, in the hard-hit city of Daegu in South Korea, a smart-city data hub helped epidemiological investigators “request, obtain and confirm data about coronavirus cases and people they have come into contact with, through a single platform.” And in Madrid and elsewhere, urban police forces have used drones to enforce quarantines.

The role of telecoms

It stands to reason that telecoms are a key enabler of the global smart cities market, which is expected to reach $237.6 billion by 2025, according to Grand View Research, expanding at a CAGR of 18.9% from 2019 to 2025. Building on existing infrastructure, telecoms can bring together myriad new solutions and services.

But — and in our opinion, this is a major “but” indeed — in order to seize this opportunity, telecoms will have to assert themselves and embrace a more powerful role.

Today, telecoms are reliable connectivity partners for the smart city infrastructure — connecting people and things, enabling industry solutions. But Ovum estimates that connectivity per se comprises only 5% to 10% of the smart-city value chain; for ambitious telecoms, the real opportunity is far greater. According to a GSMA report, only a quarter of investments from telecoms and tech companies concentrate on end-to-end solutions, and of more than 1,900 investments made by nine leading tech and telecommunications companies since 2010, only 66 involved smart-city ecosystems.

The challenge and the chance

We believe the smart-city movement in general, coupled with specific needs related to COVID-19, present a clear opportunity for telecoms to move up the value chain. Here are areas in which they should focus their decisions and investments in the near term:

Data aggregation, analytics and insights.

According to estimates, there will be some 500 billion devices linked together by the end of this year. With connected devices and sensors generating zettabytes of data, there is a big opportunity for telecoms to bring together this data on top of their networks, coupling data analytics with edge computing for more contextual and timely analytics and insights. For example, telecoms can offer sophisticated visual and interactive insights, generated in real time for other stakeholders in the system. The data insights can enable governments and medical trusts to build a demographic profile and understand the health patterns of consumers. Telecoms could then expose this data in a secure, regulatory-compliant manner to third-party service creators that can use it to create better services for the city, limiting the risk to data privacy and security that is one of the challenges for the smart cities.

Centralized operations management.

There is an opportunity for telecoms to act as an operational hub, managing and monitoring assets in real time. Such efforts might include an intelligent control center for public safety, utilities, healthcare and other aspects, all monitored in an integrated manner.

Vertical-specific solutions with the Internet of Things (IoT).

There is a range of vertical-specific use cases around smart transport, connected cars, smart buildings, healthcare and other areas in which telecoms can position themselves as solution providers. For starters, healthcare is a lucrative field for remote health monitoring — the detection and analysis of healthcare data to enable predictive insights on patient health, which will only become more vital in a post-pandemic world. (To learn more, see our article, “Beyond the Pipe: 5G and IoT Opens New Opportunities for Telcos.”)

Managed services.

Telecoms can bring together providers and consumers under a common digital platform. They can manage services for all segments — healthcare, connected transport, smart buildings and others — to enable efficiency, optimization and scalability of resources as needed. With their experience in technology, scale and subscriber management, telecoms are well positioned to be the managed services provider for smart cities.

As telecoms mature and deepen their play in the smart-city space, they can transition from enablers to creators in partnership with governments, city planners, and IoT device and analytics players.

Learn more by visiting the Communications section of our website, or contact us for more information.

This article was written by Manju Kygonahally, Business Unit Lead, and Murali Madhavan, Solutions and Consulting Lead, for Cognizant’s Communications, Media and Technology Practice.

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