Smart cities need a little chaos to innovate

Our planet’s cities are growing at a staggering rate. Today, more than half the world’s population lives in cities.

London has grown from 1 million to 8.5 million in 140 years, while Mumbai, Lagos, Istanbul and Sao Paulo have grown by at least 200,000 people per year in recent decades, with Lagos growing by 600,000 per year – a rate of 70 people per hour.

Today’s urban space is changing rapidly. Ubiquitous computing, with its “internet of things” corollary, is creating the so-called “smart city”.

It is widely thought smart cities will respond better to their inhabitants and their environment, becoming efficient, sustainable and liveable ecosystems. To this end, a broad spectrum of implementation models is emerging in different parts of the world.

But what is the role of government in the process of implementing smart-city developments? How can funding be used effectively, especially to promote innovation? And are huge sums of public money the right stimulant for smart cities after all?

Diametric approaches are appearing between the United States and, broadly speaking, of the rest of the world. In South America, Asia and Europe, all levels of government are quickly identifying the potential of smart cities and are working to channel significant investment in that direction.

Rio de Janeiro is building capacity at its Smart Operations centre, Singapore is about to embark in an ambitious Smart Nation effort, and Amsterdam recently channelled €60 million (Dh274.4m) into a new urban innovation centre called Amsterdam Metropolitan Solutions.

The European Union’s Horizon 2020 programme has earmarked €15 billion for 2014 to 2016, an investment that represents a significant commitment of European resources to the idea of smart cities, especially at a time of severe fiscal constraints.

In the US, however, there is little public-sector funding, yet the general idea of the smart urban space has been central to the current generation of successful start-ups. One example is Uber, a smartphone app that lets anyone call a cab or pick up a fare. Despite protests and strikes around the world (especially by cabbies in Europe), it was recently valued at a stratospheric US$18bn.

Beyond Uber, the learning thermostat Nest, the apartment-sharing website Airbnb and the just-announced “home operating system” by Apple, to name a few, attest to the new frontiers of digital information when it inhabits physical space. Similar approaches now promise to revolutionise most aspects of urban life – from commuting to energy consumption and personal health – and, as such, they are receiving eager support from venture capital funds.

Government, too, also has an important role to play. This includes supporting academic research and promoting applications in fields that might be less appealing to venture capital – unglamorous but nonetheless crucial domains such as municipal waste or water services.

The public sector can also promote the use of open platforms and standards in such projects, which would speed up adoption in cities worldwide. Barcelona has made a step in this direction with its “city protocol” initiative. This brings together cities, commercial and non-profit organisations, universities and research institutions to develop shared and interoperable guidelines for city transformation. Most importantly, these protocols will be multi-city, multi-culture, multi-partner and scale-free.

But all of this is working towards less top-down determinism governments should use their funds to develop an organic, bottom-up innovation ecosystem geared toward smart cities. This must go beyond supporting traditional incubators and aim to produce and nurture the regulatory frameworks that allow innovations to thrive.

Regulation is still vitally important but in a more responsive way – governments can take the pulse of innovation and its effect on society without creating unnecessary legislative constraints. However, they will have to be quick on their feet, responding to technologies as they emerge and giving new developments the room to grow.

There seems to be a fine line for governments to walk as they implement smart-city strategies: they should, at all costs, steer away from the temptation to play a top-down role. It is not their prerogative to decide what the next smart-city solution should be – or to use their citizens’ money to bolster the position of the technology multinationals now in this field. Conversely, they should create all the conditions to grow innovation ecosystems.

And here might lie another delicate balance: between smart-city efficiency and innovation.

In some cases the latter will also need a good dose of chaos – the opposite of maximum optimisation. The most creative solutions often emerge and thrive in less regulated and “messy” environments – in other words, “less smart” might be necessary, if “smart” is to be more than an empty label.

Professor Carlo Ratti is the director of the MIT Senseable City Laboratory, the director of the MIT Italy Programme and the chairman of the World Economic Forum's global agenda council on the future of cities

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