Government Technology Featured Article
September 21, 2012
Cloud, Big Data Make Big Impact on City Government
By Erin Harrison, Executive Editor, Cloud Computing
As municipalities face increasing pressure to bring economic growth and improve local services – typically with lower budgets – cloud computing is helping cities reduce capital expenses and achieve greater efficiencies.
New platforms for communication, data sharing and application development – particularly cloud computing and data analytics – will play a key role in this IT transformation, according to a new report from Pike Research (News - Alert), a part of Navigant’s Energy Practice.
By 2017, cities will spend almost $4.8 billion on so-called smart government technology, according to the report. Annual investment in smart government technologies in North America alone will surpass $1 billion in 2017, and annual investment in cloud services for smart cities will reach nearly $1.4 billion worldwide by 2017.
“Cloud-based computing, in particular, offers new options for cities that reduces capital expenditure, provides access to new skills, and reduces time-to-deployment of new solutions,” Eric Woods, research director at Pike Research, said in a statement. “Cloud-based systems also enable cities to take advantage of the huge amounts of operational data they collect to improve efficiency and develop new services.”
Government investment in cloud services was $255 million in 2011 and is estimated to reach just under $1.4 billion by 2017. In addition, the smart government data analytics software market is projected to grow from a $306 million market in 2011 to reach over $1 billion in 2017.
The combined software and services market for smart government data analytics is estimated to be worth $3.75 billion by 2017.
In addition to reducing costs, IT decision makers in cities are also looking at investment in technology as a means of stimulating economic growth.
Some strategies, according to Pike Research, include making the city a center of cleantech development and innovation (e.g., Denver, Copenhagen and Amsterdam); creating new types of digital commerce and development (e.g., New York and Manchester); being at the leading edge of technology adoption (e.g., Barcelona and Friedrichshafen); becoming an exporter of technology (e.g., Seoul); or retaining or establishing a position as a regional trading hub (e.g., Singapore and Songdo).
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Edited by Braden Becker
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