Smart Cities Market Size, Share, Trends, Analysis and Forecasts by Region, Application (Smart Transportation (Intelligent Transportation, Parking Management, Smart Ticketing), Smart Infrastructure (City Surveillance, Smart Lighting, Command and Control Services, Smart Grid, Smart Building, Smart City Platforms) and Segment Forecast 2022-2026
Smart Cities Market Overview
The smart cities market size was valued at US$ 511.1 billion in 2021 and is expected to grow at a compound annual growth rate (CAGR) of 8.1% during 2022-2026. The inclination of population to migrate to cities is one of the primary reasons for the world becoming increasingly urban. Cities cover only 2% of the Earth’s surface but account for 50% of its population, which has fueled the growth of smart cities. The pandemic too emphasized on the importance of smart infrastructure implementation in the cities to avoid chaos and excessive burden on of healthcare facilities, public transport & governance.
Smart Cities Market Overview
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The European region dominated the market accounting for more than 30% of the total market in the year 2021. The rapid implementation of smart city projects and the number of existing digital cities in the region drive the smart cities market growth which is anticipated to be steady over the forecast period.
Furthermore, advancements in smart city technologies have improved the efficiency of smart city solutions and that, in turn, has strengthened the confidence of ministries and governments in deploying these solutions. Effective use of emerging tech such as Artificial Intelligence & Internet of Things (IoT) is further anticipated to increase the adoption and implementation of smart city solutions over the forecast period.
Governments and administrations around the world have been favorable towards implementing smart city solutions owing to several advantages they provide for smooth operations of numerous activities carried out in the city on daily basis. Smart city solutions have also been observed to be critical in improving overall safety, reducing the carbon footprint, and improving the efficiency of city resources management which has also positively impacted the public sentiment towards the adoption of smart city solutions.
Smart Cities Market - COVID-19 Impact
The pandemic’s fallout means cities face a growing number of problems during a period of serious economic uncertainty. As a result, cities will view proposed smart city initiatives differently. For it to be a justifiable investment, an initiative must have a clear, relevant purpose and be as cost-effective as possible. The alternative technologies of only vaguely articulated benefit will become less attractive to cities. Boston was an early pioneer of this approach. In its 2016 Smart City Playbook, Boston encouraged tech vendors to engage with residents and identify the problems that needed addressing before picking up the phone. Smart cities now have no choice but to adopt this mantra.
The last two years have produced numerous examples of cities prioritizing post-pandemic resilience over technological gloss. Columbus is expanding affordable wireless internet access to underserved communities to ensure online education works for the underprivileged. Rotterdam is combatting the unemployment exacerbated by the pandemic by awarding digital tokens to companies that employ vulnerable residents. These tokens can be traded similarly to how carbon offsets can be converted into tradeable assets in a carbon market.
Smart Cities Market Segmentation by Application
Smart cities applications primarily include smart transportation, smart infrastructure, smart grid, smart building, and smart city platform segments.
As of 2021, the smart transportation segment captured the highest share owing to the inclusion of key components such as smart mobility, parking management, and smart ticketing, among others. The smart transportation segment was valued at US$ 144.4 billion in 2021 and is anticipated to grow at a compound annual growth rate (CAGR) of more than 7%.
Smart Cities Market Share by Application, 2021 (%)
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The smart infrastructure segment accounted for more than 20% of the application segment and is anticipated to grow at a CAGR of more than 6% over the forecast period.
Smart Cities Market Segmentation by Smart Transportation
The smart transportation segment includes intelligent transportation, parking management, and smart ticketing. The intelligent transportation segment captured the largest market share at approximately 35% and is anticipated to grow at a CAGR of more than 8% over the forecast period.
Smart Cities Market Share by Smart Transportation, 2021 (%)
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The growth of the intelligent transportation segment is attributed to the increased penetration of smart mobility solutions in smart city structures around the globe. The implementation of smart mobility solutions is driven by the need to reduce the number of vehicles on roads, effectively reducing traffic congestion. Furthermore, factors such as reducing the carbon footprint of transportation, improving road safety, and operational efficiency of transportation have also contributed to the segment growth.
Smart Cities Market Segmentation by Smart Infrastructure
Based on smart infrastructure, the smart cities market is categorized into city surveillance, smart lighting, and command & control systems. The command & control systems segment captured the largest market share at 35% valued at US$ 58.7 billion in the year 2021. Command & control systems of a smart city include different operating mechanisms that supervise several components of a smart city framework. The criticality of CCS in smart cities has led to its increased adoption over the last few years and is anticipated to continue over the forecast period.
The city surveillance segment is anticipated to witness healthy growth at a CAGR of more than 7% over the forecast period.
Smart Cities Market Analysis by Region
Europe’s smart city market value was the highest in 2021, capturing over 30% of the overall market size. The regional demand was led by the implementation of innovative smart city solutions across countries such as the UK, Germany, France, and Spain, among others.
Europe Smart Cities Market Share by Country, 2021 (%)
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North America is projected to witness steady growth at a CAGR exceeding 6% over the forecast period. The North American region is characterized by a strong inclination towards rapid digital transformation and implementation of smart city solutions such as smart mobility, smart buildings, and smart grid among others. The adoption of next-gen technologies coupled with conducive governments and administrations is anticipated to drive the regional growth over the forecast period.
Smart Cities Market - Competitive Landscape
The smart cities industry is moderately consolidated. However, with the growth of start-ups and new venture launches the competition is gradually intensifying. Key players in the smart cities market include Microsoft Corp, Accenture, IBM, and Hitachi, among others.
Mergers and acquisitions form a major part of the smart cities competitive environment, since many of the vendors collaborate on project basis to deliver specific solutions. Additionally, the major competitors are observed to be investing heavily in R&D activities to innovate the product/service at the same time adhere to the delivery timelines.
Leading Players in the Smart Cities Market
- Microsoft Corp
- Hikvision
- Hitachi
- Honeywell
- Alibaba Group
- Cisco Systems Inc
- International Business Machines Corp (IBM)
- Huawei Technologies Co. Ltd.
- iFlytek
Other Smart Cities Market Vendors Mentioned
Johnson Controls, Nokia, Schneider Electric, and ZTE Corp.
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Smart Cities Market Research Overview
| Market Size (2021) | US$ 511.1 billion |
| CAGR (2022-2026) | 8.1% |
| Forecast Period | 2022-2026 |
| Historic Period | 2019-2020 |
| Report Scope & Coverage | Revenue Forecast, Competitive Index, Company Market Share, Growth Trends |
| Application Segment | Smart Transportation, Smart Infrastructure, Smart Grid, Smart Building, and Smart City Platform. |
| Smart Transportation Segment | Intelligent Transportation, Parking Management, and Smart Ticketing. |
| Smart Infrastructure Segment | City Surveillance, Smart Lighting, and Command & Control Systems. |
| Key Companies | Amazon Web Services, Google, and International Business Machine Corporation (IBM), Microsoft Corp, Alibaba Holdings Ltd, Tencent Holdings Ltd, Oracle Corp, Salesforce Inc, SAP SE, Cisco Systems Inc |
Smart Cities Market Segments and Scope
GlobalData Plc has segmented the smart cities market report by application and region:
Smart Cities Application Outlook (Revenue, USD Million, 2019-2026)
- Smart Transportation
- Intelligent Transportation
- Parking Management
- Smart Ticketing
- Smart Infrastructure
- City Surveillance
- Smart Lighting
- Command & Control Systems
- Smart Grid
- Smart Building
- Smart City Platforms
Smart Cities Regional Outlook (Revenue, USD Million, 2019-2026)
- North America
- US
- Canada
- Europe
- Germany
- UK
- France
- Spain
- Italy
- Rest of Europe
- Asia Pacific
- China
- Japan
- India
- Australia
- Rest of Asia Pacific
- South & Central America
- Brazil
- Mexico
- Colombia
- Rest of South & Central America
- Middle East & Africa
- Kingdom of Saudi Arabia (KSA)
- United Arab Emirates (UAE)
- South Africa
- Rest of Middle East & Africa
The market intelligence report provides an in-depth analysis of the following –
- Smart cities market outlook: analysis as well as historical figures and forecasts of revenue opportunities from the channel type, business model, spend category, and regional segments.
- The competitive landscape: an examination of the positioning of leading players in the smart cities market.
- Company snapshots: analysis of the market position of leading service providers in the smart cities market.
- Underlying assumptions behind our published base-case forecasts, as well as potential market developments that would alter, either positively or negatively, our base-case outlook.
Reasons to Buy
- This market intelligence report offers a thorough, forward-looking analysis of the global smart cities market by channel type, business model, spend category, and key opportunities in a concise format to help executives build proactive and profitable growth strategies.
- Accompanying GlobalData’s Forecast products, the report examines the assumptions and drivers behind ongoing and upcoming trends in smart cities markets.
- Porter’s five forces analysis: demonstrates the strength of suppliers and buyers along with market competition in the market.
- The report also highlights key application segments (Smart Transportation, Smart Infrastructure, Smart Grid, Smart Building, and Smart City Platform)
- The report also highlights key smart transportation segments (Intelligent Transportation, Parking Management, and Smart Ticketing)
- The report also highlights key smart infrastructure segments (City Surveillance, Smart Lighting, and Command & Control Systems)
- With more than 20 charts and tables, the report is designed for an executive-level audience, boasting presentation quality.
- The report provides an easily digestible market assessment for decision-makers built around in-depth information gathered from local market players, which enables executives to quickly get up to speed with the current and emerging trends in smart cities markets.
- The broad perspective of the report coupled with comprehensive, actionable detail will help BFSI stakeholders, service providers, and other smart city players succeed in growing the smart cities market globally.
Key Players
Table of Contents
List of Tables
List of Figures
Frequently Asked Questions
The smart cities market size was valued at US$ 511.1 billion in 2021.
The smart cities market size is expected to reach US$ 744.1 billion by 2026.
The smart cities market is expected to grow at a CAGR of 8.1% during the forecast period (2022-2026).
The inclination of population to migrate to cities is one of the primary reasons for the world becoming increasingly urban. Cities cover only 2% of the Earth’s surface but account for 50% of its population, which has fueled the growth of smart cities.
Application: Smart Transportation, Smart Infrastructure, Smart Grid, Smart Building, and Smart City Platform
Smart Transportation: Intelligent Transportation, Parking Management, and Smart Ticketing.
Smart Infrastructure: City Surveillance, Smart Lighting, and Command & Control Systems
The leading smart cities companies are Microsoft Corp, Accenture, IBM, Hitachi, Honeywell, Alibaba Group, Huawei Technologies Co. Ltd., and Hikvision, among others.
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