The Benefits and Drawbacks of Smart Cities

In this technological age, everything is connected. The increased connectivity and innovative tech developments of today have led to the evolution of smart cities – cities that create efficiencies, promote sustainability, and improve the quality of life of their residents through the integration of technology. Smart city planning is essentially the scaling up of the Internet of Things (IoT), the oft-used tech found in smart homes around the globe. Homeowners use IoT to create a web of data and technologies throughout their homes that allow them to automate various tasks and routines, such as locking doors or turning on lights.

A well-planned smart city will take the core concept of automation and level it up to facilitate all the best aspects of a smart city: connectivity, convenience, sustainability, and more. Yet with any new technology, the key phrase is well-planned. This is where commercial real estate development can play a pivotal role. Developers can work with city planners, builders, and other construction professionals to assess the pros and cons of various smart city tech to create the best-connected cities.

Advantages of Smart Cities

According to an article by the Strate School of Design, smart cities are advantageous in their efficient distribution of resources, which leads to improved planning. This can be seen particularly in the transportation sector. Cameras at bus stops can gauge passenger density while sensors on approaching buses can determine how many people board the bus at a given time. The combination of information from these two sources can then be analyzed to redistribute people and buses for better efficiency.

The city of Nanjing, China is an excellent smart city case study that demonstrates improved mobility and reduced congestion. With sensors on 10,0000 taxis, 7000 buses, and 1 million private cars, experts can analyze the resultant traffic data and update residents – in real-time – through their smartphones.

Efficient transportation also leads to an improved environment as a result of lowered carbon emissions. This focus on sustainability is key to safeguarding the future of our planet and is a major factor in the development of smart cities across the world. Bhopal and Bhubaneswar in India are two such examples that aim to prioritize sustainability as they transform into smart cities. Smart transportation solutions in cities are becoming even more important as more urban centers are playing host to ecommerce and delivery fulfillment centers. Practices such as transportation optimization and the use of artificial intelligence (AI) can help make these fulfillment centers as eco-friendly and “smart” as possible. AI is especially beneficial here because its uses spread further afield than just the fulfillment center. It can and should be integrated into the entire smart city ecosystem to automate healthcare, banking, transportation, and more.

Smart cities can also aid in environmental management through their water management technologies, waste management, and energy management. One such example is Buenos Aires, Argentina. Buenos Aires is a port city that often experiences severe flooding. As stated in an article by the Smart Cities Council, “Buenos Aires enhanced and optimized its IT infrastructure with enterprise major SAP’s Mobile Platform and SAP Process Integration technology. It put IoT enabled radar sensors into the drains to monitor floods and 1500 kilometers of the drainage pipeline infrastructure went live.” The resultant data is studied to issue alerts about storms and floods so that, in case of a disaster, people can be evacuated in time.

Another city staple capable of sharing its data is the local bank. It may seem implausible to consider digital banking as a part of smart city IoT, but consider how individuals are using online banking. Online banking is supported by many customers because of its many advantages. These include the ability to access accounts anywhere, anytime. Customers can make deposits without interacting with tellers or even an ATM. If accessed legally, the data that is tracked and collected by digital banks can be used to help smart city developers bring their communities into the future. French bank BNP Paribas is exploring the possibility of using its data and analytics to support city planning.

Online banking is especially helpful during global health crises, where it is safer to switch to online transactions. Banks encourage customers to use existing remote channels and digital products to limit their reliance on branches. Call-based tutorials, SMS, mobile apps, and digital media can help make a large customer base aware of essential banking services online, as well as encourage fraud prevention measures and notify customers of bill payments and spending activity. Elderly and other vulnerable customers can also be better served via remote access, even if they are unfamiliar with digital banking methods. For nationally-run banks, safe and affordable retail payment systems like the Reserve Bank of India’s NEFT and IMPS, which promote digital banking in uncertain times.

Drawbacks of Smart Cities

Yet because it is in the early stage of implementation, smart city development has its fair share of drawbacks. The technology deployed in these evolving cities often overlooks social needs and outpaces policy changes, creating a grey area ripe for exploitation. Because the development of these cities requires large budgets, they often end up favoring the rich and contributing to already existing social and economical divides, especially in developing countries.

The greatest risk of digitizing our infrastructure is the threat of cybercrime that could wreak havoc on millions of lives. Smart cities are convenient targets for organized cybercriminal groups and can lead to massive losses of valuable information. Cybercrime activities are continuously evolving, resulting in the possibility of a breach at any point.

Various organized cybercrime groups that may target smart cities include hacktivists, who usually commit cybercrimes driven by political or social agenda, and terrorists, who use digital platforms to promote ideologies, recruit members, and instill fear through intimidating videos. State-backed hackers are funded by one state to perform digital espionage on another’s national infrastructure. There are also insider threats where anonymous hacker groups blackmail insiders to attempt to access passwords and sensitive data. Finally, smart cities may also fall prey to cybercriminals who don’t fit under one category but are a threat nonetheless.

There are several safeguarding measures that smart city planners can take to secure smart cities:

A more sophisticated form of penetration testing can assess the readiness of not only smart technologies in a city but public services such as first responders and health care. Penetration testing involves simulating attacks on technology to identify any vulnerabilities and then create and implement corresponding security measures.

Data encryption scrambles any data to prevent unauthorized access. This is key when dealing with systems as complicated as city-wide water systems or smart building systems that control features such as elevators as well as IT services.

Security monitoring should be a built-in security measure, capturing and analyzing data as it detects threats and isolates affected devices, which in some cases can be as complicated as whole building systems.

Securing Smart Cities

Security measures also need to be implemented in terms of the specific capabilities of smart cities like online banking. Financial institutions must institute policies and measures to resist fraud and account takeovers. This could include measures like biometric authentication and multi-factor authentication for mobile apps to prevent the laundering of money. These measures will help build consumer trust.

For a city to become “smart,” it is imperative to invest in modernizing information technology and security infrastructure. Implementation of smart grids and artificial intelligence is necessary, as is the need to adopt ISO 27001, an international standard that lays down the best practice for information security management systems (ISMS).

The more developers and other real estate professionals can view smart city planning as smart home planning on a grander scale, the smoother the transitions can become. One of the key aspects of real estate developers’ selling is convenience. Smart cities are essentially the epitome of the IoT. The Internet of Things in a smart home allows a resident to go through their day from bed to front door and back again in the most convenient manner. The best smart cities allow that same resident an equal level of convenience from the moment they set foot across the border of the city.