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Cities and Factories: Will Smart City Networks Be the Ultimate Manifestation of Industrial IoT?

By Special Guest
Juhi Fadia, Correspondent
August 09, 2019

Rapid advances in technology in Smart Cities are growing in parallel with advancements in Smart Factory and other Industrial IoT (IIoT). What makes them similar?

The number of endpoints, for one, as deployments are growing larger and more complex.

Michael Porter has written about the future of Smart Cities as a “system of systems” where, for example, a street light becomes a smart asset with more instrumentation, then becomes a smart connected asset that can play a role in a connected (for example street safety and traffic control), and that I then becomes part of an even bigger system where in a single city, there are four main categories.  Porter wrote in the Harvard Business Review along with James E. Heppelmann, Smart Cities will include City Services & Infrastructure, Water & Wastewater, Building Management and Power & Grid, all which can be overseen centrally and support by private and public partnerships.

In Smart Factories, a similar path has been taken, when, for example, a large plant replaces their old lighting with smart LED lighting; this then creates a digital infrastructure including stronger WiFi, use of cameras, placement of temperature and humidity sensors, counting solutions, and more. Thus one implementation (which can often save so much money it can fund additional applications) leads to further growth and value creation, while also driving a need for unification of systems, and understanding of economics and scale, and perhaps most critically, the need for security on all layers of the stack – sensors, actuators, gateways, networks, applications, clouds and control systems.

Security in both worlds has become paramount.

“Whether the device is a smart energy meter, a parking meter, a pressure valve, or an environmental sensor, all of these devices require at least some level of onboarding, management, and data security,” a white paper published by Georgia Tech said, “As the asset classification and primary tasks become more critical, the required data security model protecting the system of systems that consume this data, and in some cases provide Supervisory Control and Data Acquisition (SCADA) functionality, must be implemented with an interoperable, standards-based approach.”

Within factories, similar security features are required, particularly given the need for physical safety for workers, but also to thwart attacks that can range from theft of data to shutting down plants and services for ransom or other harm.

The amount of spending is another important commonality.

According to a May 2019 study by Grand View Research, the global smart cities market is expected to reach USD 237.6 billion by 2025, expanding at a CAGR of 18.9% from 2019 to 2025. Grand View says, “Smart cities encapsulate an overwhelming number and variety of domains and application areas that are enhanced with technological advancements and their effective use to provide services to people,” and that “Demand for city solutions is anticipated to be on the rise, owing to a number of factors such as growing urban population and need to better manage limited natural resources and environmental sustainability. Rapid urbanization, aging infrastructure, and adoption of new technology, coupled with need for improved quality of life, are also driving the industry.”

The market for Industry 4.0 products and services is expected to grow to $310B by 2023 according to IoT Analytics soaring globally from $119B in 2020 to $310B in 2023, attaining a 27.04% Compound Annual Growth Rate (CAGR).

IoT Analytics bases this forecast on six core building blocks (hardware, connectivity, cloud platform & analytics, applications, cybersecurity, and system integration) and six supporting technologies (additive manufacturing [3D printing], augmented and virtual reality [AR & VR], collaborative robots, connected machine vision, drones / UAVs, self-driving vehicles [SDVs]).

Even here we see the analyst community looking at Smart City as part of Industry 4.0, and this blending is fueling even more innovation and investment across categories.

What makes them different?

Chief among what distinguishes Smart City implementations is the requirement for mobility. In factories, endpoints are chiefly fixed, or attached to equipment that may be mobile (for example racks of parts) but does not move beyond the boundaries of the factory itself.

Ericcson is forecasting the number of cellular IoT connections is expected to reach 3.5B in 2023, increasing at a CAGR of 30%, and in large part this can be attributed to Smart City projects. With more people and things on the move, and the dynamic nature of urban areas, 5G Narrowband IoT and other protocols must be comprehensively planned, tested and managed; this includes LoRaWAN, Sigfox, WiFi, Bluetooth, and other transmission network options. 

We asked experts in Smart City and Smart Factories to weigh in on their vision for leveraging the common requirements between the two worlds.

According to Don DeLoach, Co-founder and CEO of Rocket Wagon Venture Studios and co-author of “The Future of IoT”, “the progression to a system of systems, as articulated by Michael Porter and Jim Heppemann in their seminal paper in the Harvard Business Review from 2014, is going to succeed or fail largely based on the fundamental architecture of these systems. The battleground will be data ownership and governance, but the considerations must extend to the chipsets, security models, privacy considerations, communications choices and other foundational elements, and especially to the interrelationships between these elements.”

DeLoach added, “the significant benefit to getting this right, however, is not just a single richer dataset, but richer data for numerous constituents throughout the system of systems. The power of analytics, be it operational, investigative, or predictive analytics and most certainly Artificial Intelligence and Machine Learning are a function of the scope and quality of the data that fuels the analytics, and in this regard, a thoughtful architecture means everything”.

Bill Adiletta, a pioneer in networking, software and application development, data modeling and now the IoT and Industrial IoT said, “Both Smart Cities and Smart Factories share the same challenge as simply processing the volume, velocity, and variety, of data which is the definition of Big Data. Associated with these 3Vs is the challenge of storing, managing, and analyzing the data. The extension to the 3Vs additional characteristics for big data, include veracity, value, variability, and complexity including real-time status updates, event monitors and triggers and security breaches, detected or – worse – undetected.”

Adiletta continued, “Certainly the common requirements between Smart City and Smart Factories regarding data is the need to address the same resulting onslaught of data, highlighted above, which can either be an ongoing headache or leveraged as a goldmine of information.  Clearly thousands to tens of thousands of sensors/monitors in a Smart City or Smart Factory will generate and enormous amount of data. There is little value to all that date if it is not mined and turned into useful information which is where Big Data Analytics (BDA) becomes so crucial to both Smart City and Smart Factories.”

He further explained, “Application of BDA can turn this onslaught of data into information by cross-correlation of the data providing trending information, pattern detection, leading to predicting outcomes. The ultimate purpose of IoT BDA is efficient and effective controls and decision making. That is rapidly monitoring ongoing status of all sensors and making corrections in anticipation of issues. Analytical tools utilize a variety of algorithms to discover patterns, trends, and correlations across the vast horizon of data. After analyzing the data, the information must be provided in a variety of formats such as tables, graphs, and charts for efficient decision making.”

Ed Wood, CEO of Dispersive Networks (a patented, multi-path software-defined network security, military-grade overlay solution) said, “By 2050, its’ estimated that upwards of 70% of the world’s population will live in urban areas. Like it or not Smart City development is necessary and inevitable. With the IoT at the core of this development, the objective is to maximize operations, so security becomes a much greater risk for all the players involved. A new study showed that 88% of people are concerned about their private information in a smart city scenario.”

“For smart cities to succeed, there must be trust,” Wood continued. “The simple truth is, most security teams are not prepared for the types of attacks we are currently facing. Add to that, the massive amount of new data being collected and the increase in attack surfaces being created daily, it becomes the perfect storm!  That said, security needs to be a priority and a forethought when planning for any smart city foundation being built today.”   

Bob Mazer, co-founder and CEO of Smart City Works, a non-profit based in DC which, along with Refraction, a non-profit innovation hub, recently received a $750,000 federal grant to develop a regional smart infrastructure innovation program for Northern Virginia, said “As is the case with any large project bridging the physical and digital worlds, including industrial IoT implementations in single and multiple factories, developing a successful smart city or region takes an ecosystem. We are seeing tremendous innovation not only in the technologies, but business models with blend public and private organizations and funds to be able to scale systems while also spreading risk, but mainly bringing together the most talented visionaries who understand the potential of future connected communities.

Alon Mantsur, cyber security expert, CEO of DeviceTone (an IoT company specializing in firmware for consumer and industrial solutions) and co-founder of Cybrella, a new cyber security consulting firm based in Boston and Tel Aviv, said “Without a comprehensive cyber security posture, and a set of unified policies, no city can be a smart city. The advantages associated with controllable LED lighting, with managing electricity and other forms of power, with better managing traffic and being able to respond to emergency events cannot be fully manifested when concerns regarding privacy and security have not been addressed fully. We’ve seen too many examples of cities in the US and elsewhere being held hostage by adversaries, and the risks associated with not securing these large deployments, whether in cities or in factories or across critical infrastructure are only going to increase. We believe one of the first mandates for these projects is to have not only a security strategy, but a platform, services and a disaster response program in place.”

It is estimated that by 2030 there will be over a trillion IoT devices managing our cities and factories! That enormous growth will require new innovations and methods of analyzing and turning the vast stores of data into information to ensure cities and factories of the future create safer and more human friendly environments to enrich our lives.

In summary, the good news is that we can gain even more momentum by thinking about Smart Cities and Smart Factories under the umbrella of Industry 4.0, where “industrial strength” technologies and applications hardened with the latest security measures will continually improve outcomes, and sustained growth and opportunities for enterprises and entrepreneurs.

Edited by Ken Briodagh
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