• smart cities
  • Smart Streetlighting
  • Smart Parking
  • Smart Meters
  • IoT

Smart Cities Increasingly Seek Broad Vendor Ecosystems

Grant Samms
Feb 28, 2023

Guidehouse Insights

With the end of acute COVID-19 precautions and the resumption of events, I’ve now had the opportunity to attend a couple of smart city conferences in person. While one was more focused on municipal perspectives and the other on vendor outlooks, there was one theme I found nearly everywhere I went: the demand for broad vendor ecosystems.

Cities Want Simplicity and Flexibility

Demand for Internet of Things (IoT) systems surged during the pandemic, and with it came an appetite from cities for systems that were both robust in scope and simple to manage. Cities are explicitly seeking vendors who can design turnkey solutions that are easy for staff to engage with and that can be readily integrated with existing and future systems. Even if this comes at an increased monetary cost, procurement offices are seeing more value in simplicity and the future flexibility to expand or contract service levels as needed. As one city official put it, “There’s value in convenience.”

Partnerships Give Vendors an Advantage

A key component of that convenience is working with vendors who can address a large number of use cases through their network of partners. Using smart streetlighting as an example, cities are becoming more averse to working with unique vendors for luminaires, networked controllers, public safety components, and IoT devices. A vendor with a wide array of partners who can make deploying and integrating this network easy is increasingly likely to win the contract, even if they are not the lowest bidder.

Vendors are responding to this trend. Leading smart streetlighting providers are establishing large stables of channel partners to build highly customizable lighting networks. Producers of parking equipment are developing mobility platforms that can collect, process, and centralize all types of mobility data into a single administrative environment. Utility metering companies are aiming to accomplish the same for electrical and water services. Many of these vendors are building sophisticated software platforms that can visualize and study data from their sensors as well as from third parties by way of robust application programming interface, or API, support.

Chicago recently finished a project with Ameresco, Itron, and ComEd to install 280,000 smart streetlights. While this project has direct energy conservation benefits, it has also intentionally created a large industrial IoT network that will support future smart city technologies. To be able to respond to emerging requirements, Itron has cultivated a partner network that can offer a large array of smart city IoT devices. In another example, the parking equipment provider SKIDATA, best known for fare gates and ticket dispensers, has been forming partnerships with parking and mobility companies to build an expansive environment of products for cities. This includes a partnership with parking data company Smarking to improve the management and profitability of municipal parking spaces.

This shift in demand indicates a significant change in how cities are viewing IoT and smart city technologies. Whereas previously, a set of cameras to study intersection congestion was seen as a cutting-edge pilot, such projects are now considered a sensible part of any forward-thinking transportation system. More cities are regarding these technologies as valuable additions to their entire lighting, mobility, or utility systems, and they are looking for vendors who can deliver in a similarly holistic way. As a feature cities are willing to pay for and vendors are reorganizing to deliver, broad vendor ecosystems are likely to be a driving force in smart city technology addition in the coming years.