Verizon -- like key rival AT&T -- said Wednesday that smart cities are a key part of its long-term strategy for the Internet of Things (IoT).

"One portion of IoT that we're really excited about is smart cities. We've got a number of pilots out there, one with Savannah, Georgia, others that we'll talk about later this year," said Marni Walden EVP and president of product innovation and new businesses at Verizon Communications Inc. (NYSE: VZ) at the Citi 2016 Internet, Media And Telecommunications Conference in Las Vegas.

The operator is currently undertaking smaller utility monitoring and traffic control tests on the East and West Coasts respectively, Walden said.

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

The race to be dominant in developing smart cities in the US has officially started. On Tuesday, AT&T Inc. (NYSE: T) said that it is working with the cities of Atlanta, Chicago and Dallas to implement smarter utility and traffic systems. (See AT&T Deal Puts 4G in 10 Million New Fords by 2020.)

Most of Verizon's IoT-related earnings are still derived from its long-standing telematics and fleet management business. "Through the fourth quarter it was a half a billion dollars [in revenues]," Walden told the conference.

Walden described the IoT and machine-to-machine (M2M) sectors as having "a ton of potential… but a long runway."

— Dan Jones, Mobile Editor, Light Reading