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AT&T Going Big on Smart Cities

Carol Wilson
1/5/2016

If they want to help municipal leaders execute smart cities strategies, service providers should start by not undermining the re-election prospects of key local politicians, Atlanta's mayor said today. Mayor Kasim Reed has signed his city up as one of AT&T's first three municipalities in the operator's new aggressive Smart Cities initiative, but, as he said today at AT&T's Developers Summit in Las Vegas, that support will only last while he's in office.

"The one thing you need to open all your meetings with mayors and elected officials is, 'What I'm going to tell you isn't going to get you beat,' " said the candid Reed. "You can give me a wonderful idea, but if the public doesn't get it, they are going to throw me out of office."

While that off-the-cuff response drew laughter, Reed said that's why the initial project for any city needs to be a strong one and it must be something the public can understand. "Inch-by-inch and project-by-project, trust is built," he added. "Most cities don't have the technical bench-strength to execute." By aiding that execution, "the mayors that believe don't get beat, and you have a client down the road for more and more deals."

Atlanta's major was part of a panel that announced AT&T Inc. (NYSE: T)'s aggressive new Smart Cities initiative, touted heavily today and aimed at what the company calls a $1.5 trillion opportunity by 2020. One of the early efforts is a field trial by AT&T and Ericsson-LG to enable the Chattahoochee Riverkeeper, an environmental advocacy group, to remotely monitor the quality of the river that supplies drinking water to Atlanta, using wireless connectivity of sensor devices to more quickly identify contamination.


Read more about Gigabit Cities and the expansion of gig services in our gigabit/broadband section here on Light Reading.

Elements of the broader AT&T strategy that were unveiled today included the selection of Atlanta, Chicago and Dallas as the first three cities involved, as well as major partnerships between the dedicated AT&T Smart Cities unit launched last fall and major players such as Cisco Systems Inc. (Nasdaq: CSCO), Deloitte Development LLC , Ericsson, General Electric Co. (NYSE: GE), IBM Corp. (NYSE: IBM), Intel Corp. (Nasdaq: INTC) and Qualcomm Inc. (Nasdaq: QCOM).

What makes the opportunity so significant, AT&T Mobility CEO Glenn Lurie said, is that it encompasses a number of different aspects of improving lives overall, including resource management for water and power; road management for safety and congestion relief; higher quality public healthcare; and better communications between cities and their citizens to enable greater efficiencies.

The panel discussion -- which was moderated by Lurie and featured Reed, Federal Communications Commission (FCC) Commissioner Jessica Rosenworcel, Ericsson CEO Hans Vestburg and Intel CEO Brian Krzanich -- laid out some of the key challenges and goals of the Smart Cities effort:

  • Smart Cities is a specific application of ongoing IoT efforts. But it needs and warrants its own unique approach because of the size of the opportunity and its ability to dramatically improve lives, Lurie and Rosenworcel agreed. The FCC's primary contribution is spectrum availability, the commissioner said.
  • Public engagement needs to focus on the benefits -- the ability to reduce traffic congestion and direct people to available parking spaces, for example, or a reduction in cost of some services, not the "wonky" conversations around wireless technology, according to Rosenworcel and Reed.
  • Business models have to change because cities need incentives to move forward in advance of any big payoff in improved efficiency, Intel's Krazanich said. That could include suppliers and vendors agreeing to accept compensation on the backend, based on a percentage of money saved, versus large upfront payments.
  • Cities have a lot of data available to them, but limited ability to analyze it and put it to use, Reed said. At the same time, they represent a faster path to moving forward, since the political infrastructure is more lightweight. "In Atlanta, you meet with me and eight council members," he said. "I think you'd prefer that over going to Washington. So cities such as Atlanta can take a leadership role and help the industry get to scalability faster. (See White House Funding Seeds Smart Cities.)
  • Globally, governments realize the benefits of connectivity. But Smart Cities efforts require the coming together of many different players, including regulators, politicians, network operators and vendors, said Vestberg. The faster that happens, the quicker progress comes.

— Carol Wilson, Editor-at-Large, Light Reading

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DHagar
DHagar
1/18/2016 | 1:44:46 PM
Re: AT&T Big on Smart Cities
@kq4ym, plus there are other options.  As we better create value from the Smart Cities, beyond just the utility to the City, there might be some additional shared investments/savings.  Those might come from also serving as platform for new applications of IoT, for regional shared savings, for cities playing host to trading partners with data and connections with smarter transportation.

The bottom line to make it sustainable is for new value to be created and for those investments and savings to be shared.
kq4ym
kq4ym
1/18/2016 | 10:48:29 AM
Re: AT&T Big on Smart Cities
To get the public onboard the idea of "vendors agreeing to accept compensation on the backend, based on a percentage of money saved, versus large upfront payments" might be worth a go. Although of course there's going to have to be some well thought out agreement of just how to define money saved on that backend.
cnwedit
cnwedit
1/8/2016 | 2:55:43 PM
Re: Pork
Dennis, that's exactly right and that's the reality with which elected city leaders have to deal. What Reed understands is, he can't afford to trumpet some big program, especially one like saving money provided better water quality, that the public might not grasp the significance of right way. 
mendyk
mendyk
1/8/2016 | 2:44:25 PM
Re: Pork
One source of disconnect regarding smart cities is between the macro expectation -- "this will be worth umptyump trillion dollars" -- and the way these changes are most likely to occur, which is incremental and piecemeal, especially where "IoT" is concerned.
cnwedit
cnwedit
1/8/2016 | 2:26:52 PM
Re: Pork
Actually, Mitch, I thought it was the most realistic piece of advice I'd heard and he wasn't being cynical. He had earlier said that he is a big proponent of smart cities. 

What he was asking for wasn't pork, it was practical applications of technology that his constituents could understand and that would make their lives better. If the initial projects have broad appeal, the politicians backing them win voter favor and stick around to help through the later, possibly tougher, stuff that also needs to get done. 

 
Mitch Wagner
Mitch Wagner
1/8/2016 | 1:25:26 PM
Pork
Kasim Reed certainly sounds cynical here. Smart cities need to be good for the cities, not just pork to get the mayor re-elected. 
DHagar
DHagar
1/5/2016 | 6:35:45 PM
Re: AT&T Big on Smart Cities
Carol, well stated.  But they are putting the right pieces together with the multiple companies that can support and deliver value to the Smart Cities, as the Mayor states.  I fully agree that the capabilities are there, but the public demand for the Smart Cities' value has to be demonstrated and then you will get the public behind it.  It has to deliver greater value than "efficient government" and better land development".

If they do this well, it should unleash demand for cities to follow.
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