Dissecting ISO 37120: How connected (and innovative) is your city?

Tue, 2014-10-07 14:44 -- SCC Staff

By George Karayannis, LEED AP

We continue our series on the new ISO 37120 Smart City standard with a look at the 13th of 17 themes defined in the standard -- telecommunication and innovation indicators.  As previously described, ISO 37120 includes 46 ‘Core’ (must report) and 54 ‘Supporting’ (should report) indicators.  The telecommunication and innovation theme has two Core and one Supporting indicators.

Innovation is the specific instrument of entrepreneurship...the act that endows resources with a new capacity to create wealth.” As Peter Drucker’s quote emphasizes, innovation is the heart of growth, and cities looking for a sustainable and competitive future need to plan, invest and manage their resources and policies to effectively support public and private innovation.  Many cities and regions around the world enviously seek to replicate the success of Silicon Valley, though few have.  Most cities, however, have the means necessary to create a flourishing environment of innovation, creativity and economic growth, even if city leaders don't fully realize it.  This ISO 37120 indicator measures mobile phone, landline and Internet connections per capita, reflecting a city's communications intensity and, by proxy, the city's propensity for innovation.

Many factors combine to determine a city's competitiveness and innovation, including ready access to capital, skilled workers, natural resources and federal, state and local policies. While city leaders can't control all of the variables in their innovation equation, they can solve for the problem in a way that advantages their outcome.  City leaders can set a strategic course, nurture innovation through clear policy and targeted investment, and accelerate growth by actively leading innovation initiatives.  For example, while many cities would like a city-wide, high-speed wireless network and ultra-fast Internet connectivity, few have the political alignment to drive such a vision, and even fewer think they have the financial resources to afford the investment.  What most city leaders don't seem to fully realize is that they are already sitting on a unique mix of resources, and the primary missing ingredients are vision and will. 

Today, for example, city street lighting is generally an expensive and poorly managed city service, consuming up to 40% of a city's budget and causing the most citizen complaints to city officials due to non-working lights.  Many cities are currently considering upgrading to LED street lighting to achieve 50% cost savings and provide better municipal illumination, and some will pursue public-private partnerships to pay for the investment through annual energy savings accrued over 10-20 years.  With a slightly bolder vision and broader approach, many cities could afford to implement infrastructure that enabled transformational levels of innovation.  Those same street lights that need upgrading cover cities in a fairly dense patchwork of always-powered poles and rights of way, and could readily support ultra-high-speed wireless and Internet networks and sensor platforms, paid for by energy savings and supported though public policies including open data access and financial incentives.  Forward-thinking cities have the opportunity to transform a current liability (street light costs) into a revenue-generating asset (next-generation communications infrastructure) that serves as a platform for new citywide digital services and innovation.  Cities generally need their electric utility at the table as a full and supportive partner to realize the full scope of these benefits.

Chicago has one of the most ambitious strategies I've seen in this regard, though the city's political dysfunction poses an even greater obstacle than the city's shaky finances to achieving the city leaders' compelling vision.  Chattanooga, Tennessee, bet big on municipal telecommunications in the 1990s and is now enjoying the fruits of that strategic investment.  When most cities and utilities were shedding communications assets, Chattanooga city leaders decided to offer high-speed citywide Internet access.  As a result, today the city provides the fastest Internet service available in the world (as fast as in Hong Kong), and consistently attracts new businesses drawn to the city's infrastructure advantage over comparable cities.  “This is a small city that I had never heard of,” said Toni Gemayel, a Florida native who moved his software start-up, Banyan, from Tampa to Chattanooga because of the Internet speed. "It beat Seattle, New York, San Francisco in building the gig. “People here are thinking big,” he said in a New York Times interview.

In addition to providing enabling infrastructure and policies, cities can also serve as ‘petri dishes’ of innovation by providing a physical environment that stimulates creativity, enables random collisions of people and ideas, and facilitates continuous private investment and skills development.  Innovation is never a straightforward process -- it is full of blind alleys, brilliant but flawed ideas, and sudden changes in direction.  Most importantly, innovation is fueled by collaboration, and that is where cities can plant the seeds of growth in their communities.  By combining next-generation communications infrastructure with proper policies and crowded, diverse and vibrant spaces such as parks, coffee shops and innovation districts, cities can stimulate the creative process and help ensure their continued competitiveness.

Core Indicators

1.     Number of Internet connections per 100,000 population.

In 2000 the Estonian government deemed Internet access a ‘basic human right’ and shortly thereafter free Wi-Fi became available countrywide.  Estonia was the first country to offer voting for general elections online and most Estonians file their taxes within minutes on their mobile phones. Health records are cloud-based, accessible at any time with an electronic personal access key which is also used for other city services.  As a result, Estonia is said to have the world’s most digitized government.

Despite this investment, according to the World Bank Estonia (80,000) does not boast the most Internet users per 100,000 population.  That title goes to Iceland (96,500), followed by Bermuda (95,300), Norway (95,100), Sweden (94,800) and Denmark (94,600).  It appears that proximity to the Arctic Circle significantly promotes Internet access.  The U.S. is 21st (84,200).   The countries with the lowest Internet penetration per 100,000 population are Eritrea (900), Myanmar (1,100) and Burundi (1,200).

2.     Number of cell phone connections per 100,000 population.

We are an increasingly mobile, and mobile phone-centric, society, to the point that an increasing number of customers no longer maintain a landline connection.  This profound and relatively sudden technological shift has resulted in massive wireless network build out globally, a dizzying pace of handset innovation and public policy challenges, and entirely new services and business models not available even 10 years ago. Mobile phones now provide a level of integration and ease of use that enables them to replace multiple devices and become an indispensable part of their users’ lives – especially for younger users. In fact, a survey by TeleNav found that many people would rather go a week without sex (33%), caffeine (55%) and chocolate (70%) than without their smart phone for a week.  And a UK study found that an increasing number of college students now shower with their cell phone and that the average adolescent would rather lose a pinky-finger than a cell phone.  

Cell phone penetration in many countries has surpassed the one phone per person threshold, with Macao (304,000), Hong Kong (239,000) and the African country of Gabon (215,000) leading the world in cell phone connections per 100,000 people, according to the World Bank.  The countries with the fewest cell phone connections per 100,000 population are repressive or war-torn, including Eritrea (6,000), North Korea (10,000), Myanmar (13,000) and Cuba (18,000).

Supporting Indicator

1.     Number of landline phone connections per 100,000 population.

I’m unsure why this measure is included, even as a supporting indicator.  People are shedding landline connections in developed countries, and undeveloped countries are investing in wireless infrastructure to speed deployment and reduce installation costs.  According to World Bank data, nearly 20 countries report zero landlines per capita, with Monaco (124,000) and Bermuda (110,000) having the most landline connections per 100,000 population.

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George Karayannis  has over 25 years of emerging technology and complex solutions sales, business development and marketing experience. He is currently Director Utility Sales, Trimble Energy and has held leadership positions at Schneider Electric, Lockheed Martin Energy Solutions, AT&T and wireless sensor startups.  He has also served as a city councilman and is restoring a 100-year old opera house to LEED Gold status. @gkarayannis

Next in the series:  Transportation indicators for smart cities

Previously in our Dissecting ISO 37120 series: