Alok Patel, CEO – Azcende Venture Capital / Global Vision Board Member
In this paper we present current thinking on smart cities in the Australian context which we hope will help policymakers and the private sector make informed decisions on how to best manage change. It has been developed based on two roundtables held in Sydney and Melbourne in May 2017.
The roundtables were hosted by venture capital firm Azcende. Participants were leaders in business, construction, infrastructure, financial services, start-ups, government, logistics, communications, education as well as smart city specialists.
We would like to extend Azcende’s thanks to all those who participated and in particular to Telstra, which kindly hosted them.
Cities are our most human invention. They are the apotheosis of function begetting form and they are 5,000 years old – at least – and almost certainly a good many millennia more ancient.
Johann Wolfgang von Goethe described architecture as “frozen music”. If architecture can be described as music frozen in time, then a smart city is surely technology breathing it to life.
We hold that as we use the millennia of human technical achievements and our nation’s treasure to breathe life into our cities, the guiding vision must be to improve the lives of the citizens of our future metropolises.
Government and the private sector must identify the projects which will have greatest impact on our lives and apply private sector expertise to implement them – at the same time, placing the risk associated with these undertakings on business.
And government must play a crucial role in setting a vision that guides and supports the private sector to deliver cities that improve the wellbeing of the people who live in them.
Smart cities are and should be magnets for talent. Despite technology enabling many people to do their jobs remotely, people engaged in collaborative enterprise still flock to cities, the creative hothouses of nations.
Australia must create urban environments that support this desire for the human contact and connection that fosters creative energy or lose our best and brightest to other nations.
Smart cities are about the most efficient use of talent, space, infrastructure and time – in short, the vast majority of things that make up the economic life and wealth of the nation.
Despite plans and good intentions, governments are often puzzled as to how to describe and execute a grand smart city vision. We argue that instead of thinking big, the opportunity is in thinking small: favouring iterative, proof-of-concept strategies that solve problems in markets where there is high demand.
Once the nascent stage has been bootstrapped into profitability, it can then be scaled up – either with government help or seed funding from the private sector.
There are many heartening portents for smart cities in Australia.
In the data space, a nationwide Internet of Things has been announced, along with the revelation that our telco giant is already reaping $150 million annually in IoT revenue.
In addition to the government’s smart cities plan, a $60 billion wish list from Infrastructure Australia and the formation of PPPs across the smart city space gives us hope for the future of our cities.
Other positive signs include governments and business recognising the potential of value capture and venture capital to fund new projects, the use of partnerships with other institutions including universities and hospitals, employing existing infrastructure more efficiently and other innovative funding models, including co-ops, community ownership and tolls as well as other user-pay models.
To ensure optimal outcomes we will need to develop the conditions listed above – including a co-operative approach by government and business, with private enterprise taking the lead on risk and a scalable proof-of-concept approach to innovation.
The sum of all these will deliver our goal – an improved urban space where people can be their best as they live, work, trade and play in comfort and safety.