Smart Cities Market Overview
The Smart Cities market is
foreseen to increase greatly between 2025 and 2035, fueled by high urban
growth, greater use of smart technologies, and heightening demand for
sustainable city infrastructure. In 2025, it is expected to grow to a value of
approximately USD 848.0 Billion. Adopting a 2035 view, it is forecast to grow
further to approximately 5,647.6 Billion. It is expected to grow by an average
of 28.2% each year for ten years.
A smart city blends digital
technologies, data analytics, and the Internet of Things (IoT) to improve citizen quality of life, increase operating
efficiency, and optimize the use of resources by sectors including
transportation, energy, healthcare,
public safety, and governance. Governments and cities across the globe are
increasingly putting sustainable urban growth in priority, which is leading to
the growing demand for smart city solutions. Market estimates predict that the
global smart cities market size is expected to see tremendous growth in the
next few years, fueled by growing investments in digital infrastructure, smart
grid, smart transportation systems, and smart public services. One of the
primary growth drivers of the smart cities market is the growing emphasis on
the reduction of carbon emissions and improving the efficiency of energy
through smart utilities and environmentally friendly practices.
Additionally, the expansion of 5G
deployment, increasing application of machine learning and AI in city planning,
and the spread of IoT devices are fast-tracking the smart city technologies'
adoption. Smart mobility, digital government, and smart healthcare are emerging
trends that are picking steam in technologically developed regions like Europe,
North America, and Asia-Pacific regions. Government-level initiatives like
smart city missions and stimulus packages as well as public-private
partnerships are also driving innovations and large-scale implementations.
Smart Cities Market Drivers and Opportunities
Advances in Iot, AI, And Connectivity Is Expected to Boost the Smart
Cities Market in The Forecast Period
Technological innovations
specifically in IoT, artificial intelligence (AI), and high-speed networking
are fundamentally transforming urban environments and pushing the smart cities
market forward. Connected devices and sensors embedded in the urban landscape
facilitate real-time data collection and communications across city systems,
including traffic lights and street lights, waste bins and meters, and beyond. AI and machine
learning add yet another level of value by analyzing trends, predicting
behavior, and enabling automated decisions, which result in improved efficiency
and decreased manual errors. For example, surveillance systems enhanced by AI
increase public safety by sensing suspicious behavior, and smart waste
collection platforms optimize collection routes and lower operating expenses.
Simultaneously, deployment of 5G networks has driven data transfer speeds a
thousandfold while decreasing latency, making smart city ecosystems faster and
more resilient. These technologies are increasingly integrated in day-to-day
urban activities, supporting predictive maintenance of infrastructure, adaptive
traffic flow, remote delivery of healthcare, and much more. As digital
transformation picks up speed, cities increasingly turn to these smart
solutions to augment operational robustness and boost city living quality. This
technology-driven transformation is not only a core driver of market growth but
also a significant differentiator for cities competing to secure investment and
talent in a globalized world.
Government Initiatives and Public-Private Partnerships Is
a Vital Driver for Influencing the Growth of the Global Smart Cities Market
Supportive government policies and growing
public-private partnerships (PPPs) are key drivers of smart cities market
growth. Governments all over the world are becoming aware of the capability of
smart cities to spur economic growth, environmental sustainability, and social
progress. Initiatives such as India’s Smart Cities Mission, the European
Union’s Horizon 2020 initiative, and city-level initiatives in North America
provide funding, structures, and technical support for the modernization of
urban infrastructure. These projects are frequently complemented by investment
incentives, policy changes, and backstopping by the government that facilitate
collaboration between tech players and city developers. Public-private
partnerships are crucial as they bring together governmental funding and
support and private sector creativity and agility. These partnerships
facilitate the rollout of massive smart city projects such as intelligent
transportation networks, digital government platforms, and smart utilities. In
addition, the availability of PPPs speeds up the deployment of technologies
while lightening the spending load of public institutions. It also reduces
concerns on risk and spurs relentless innovation. As governments keep
collaborating with leaders in technologies and infrastructure developers to
pursue their smart city strategies, PPPs will be central in scaling smart city
ecosystems all over the world, leading to consistent market growth.
Smart Mobility and Intelligent
Transportation Systems Is Poised to Create Significant Opportunities in The
Global Smart Cities Market
Smart mobility is one of the market opportunities
in smart cities that holds transformative potential in transporting people and
goods in urban settings. Congested streets, increasing emissions by vehicles,
and poorly designed public transportation systems are becoming issues of
importance in urban life. Smart mobility solutions ranging from intelligent
traffic management, real-time public transit tracking, ride sharing, and
connected driverless cars are becoming viable solutions to these problems. Through
IoT sensors, GPS, and AI algorithms, cities can optimize traffic flow, speed
commutes, and overall passenger experience. For instance, smart traffic lights
can change in real-time according to traffic congestion, while predictive
analytics using AI can assist cities in better planned routes and
infrastructure. Further, the increased interest in micro-mobility in the form
of e-bikes and e-scooters provides cleaner, last-mile transport solutions that
are integrated in the larger urban mobility system. Investment in electric
vehicle infrastructure and mobility-as-a-service (MaaS) platforms also
facilitates this transformation. Government initiatives towards greener and
efficient transportation systems boost the demand for smart mobility solutions.
As the sector transforms, there is plenty of opportunity for technology
providers, startups, and city planners to redesign transportation in cities for
a smart, greener future.
Smart Cities Market Scope
Report
Attributes |
Description |
Market Size in 2025 |
USD 848.0 Billion |
Market
Forecast in 2035 |
USD 5,647.6
Billion |
CAGR % 2025-2035 |
28.2% |
Base
Year |
2024 |
Historic Data |
2020-2024 |
Forecast
Period |
2025-2035 |
Report USP
|
Production, Consumption, company
share, company heatmap, company production capacity, growth factors and more |
Segments
Covered |
|
Regional Scope |
|
Country
Scope |
1) U.S. 2) Canada 3) U.K. 4) Germany 5) France 6) Italy 7) Spain 8) Benelux 9) Nordic Countries 10) Russia 11) China 12) India 13) Japan 14) South Korea 15) Australia 16) Indonesia 17) Thailand 18) Mexico 19) Brazil 20) Argentina 21) Saudi Arabia 22) UAE 23) Egypt 24) South Africa 25) Nigeria |
Smart Cities Market Report Segmentation Analysis
The Global Smart Cities Market Industry
Analysis Is Segmented into By Component, By Technology, By Solution, By
Application, And By Region.
The Hardware Segment Is Anticipated to Hold the Highest Share of the
Global Smart Cities Market During the Projected Timeframe.
Based on component, market is segmented into Hardware, Software, and Services. In 2025, Hardware emerging as the dominant segment with 56.5% of market share. Hardware plays a foundational role in the smart cities ecosystem, serving as the backbone for implementing various intelligent systems, including IoT sensors, surveillance cameras, smart meters, connected vehicles, and communication devices. The increasing deployment of physical infrastructure to support data collection, monitoring, and automation is a key factor driving the growth of this segment.
The IoT Dominated the Market in 2024 And Is Predicted to Grow at The
Highest CAGR Over the Forecast Period.
By technology market, it is
divided into IoT, AI & ML, Cloud Computing, 5G Networking, Edge Computing,
and Others, among which IoT (Internet of Things) stands as the leading segment.
IoT acts as the technical pillar of smart city infrastructure by providing
end-to-end connectivity and data sharing between diverse devices, systems, and
services. From waste management systems and traffic signals to water supply
systems and public safety devices, IoT links and automates urban processes to
ensure enhanced efficiency, sustainability, and quality of service delivery.
Growth in this segment is mainly influenced by the growing demand for real-time
data monitoring and the growing use of sensor-based smart applications in
developed and emerging markets.
The Smart Transportation Segment Is Predicted to Grow at The Highest CAGR Over the Forecast Period.
By solution market, the segments
are divided into Smart Governance, Smart Economy & Development, Smart
Transportation, Smart Monitoring & Control, Smart Healthcare, Smart &
Sustainable Environment, and Others. among which Smart Transportation stands as
the leading segment. As cities get congested, the demand for intelligent and
sustainable mobility solutions is growing at a phenomenal rate. Smart
transportation caters to top urban issues like traffic congestion, lengthy
commute, and growing pollution by using technologies like IoT, AI, GPS, and
real-time analytics.
The Transportation Segment Is Expected to Dominate the Market During
the Forecast Period.
The global market for smart
cities is segmented by application as Transportation, Waste Management, Energy
Management, Utility Management, Public Safety, Environmental Monitoring, and
Others, among which Transportation is the leading segment. Transportation is
leading the market due to the increasing need for safe, efficient, and
sustainable mobility solutions for cities. As cities experience urbanization,
they are challenged by traffic congestion, increased commute times, and high
levels of pollution. Smart transportation systems, empowered by IoT, AI, and
real-time analytics, meet these challenges by streamlining traffic flow,
enhancing public transit, and providing electric vehicle (EV) infrastructure.
The following segments are part of an in-depth analysis of the global smart
cities market:
Market
Segments |
|
By Component |
|
By Technology |
|
By Solution |
|
By Application |
|
Smart Cities Market
Share Analysis By Region
North America Is
Projected to Hold the Largest Share of the Global Smart Cities Market Over the
Forecast Period.
In 2025, North America will be
the leading regional market with 49.1% market share. Strong technological base
in the region, high level of urbanization, and strong government support are
the primary inducing forces for the dominance of the smart cities market in the
region. Large countries like the United States and Canada have immense
investments in smart infrastructure, notably in smart transport, public
protection, energy management, and smart healthcare. Key presence of
large-scale technology suppliers, coupled with early incorporation of
innovative solutions like IoT, AI, and 5G, has further propelled smart city projects
in key cities. Government support in the form of funding schemes and
public-private collaborations by the government and the local governments has
also played a pivotal role in pushing digital urban transformation in the
region. Consumer awareness and demand for smart and connected urban life also
favor the growth curve of the smart cities market in the North American market.
As focus on infrastructure and digitization continues in the region, it is
likely that the dominance of the market will continue in the forecast years.
Asia-Pacific (APAC), though
lagging in terms of market share, is expected to exhibit the highest CAGR
during the forecast years. Large-scale urbanization, growing government
spending, and growing demand for smart infrastructure in emerging markets in
China, India, and Southeast Asia drive this growth.
Smart Cities Market Competition
Landscape Analysis
The global Smart Cities Market is
poised for significant growth, with key players investing heavily in technology
and infrastructure. These companies are actively engaged in research and
development, strategic partnerships, and large-scale project implementations to
enhance their market positions.
Global Smart Cities
Market Recent Developments News:
December 2023, Qatar property developer
Msheireb Properties (MP) signed a Memorandum of Understanding (MoU) with
Microsoft Corporation, developer of software products, to create a ‘Smart
Experience’ for the visitor, retail, resident, and commercial customer in MP’s
Msheireb Downtown Doha (MDD) development.
November 2023, Smart City Expo World Congress (SCEWC) is the world's largest trades fair on cities and smart urban solutions that is held by Fira de Barcelona. It is a show of smart city solutions and projects centered on how to make modern cities greener, smarter and more habitable. SCEWC's congress program includes eight core themes: energy and environment, enabling technologies, mobility, housing and inclusion, management and economy, security and blue economy, and infrastructure and buildings.
The Global Smart Cities Market
is dominated by a few large companies, such as
·
Schneider Electric
·
ABB
·
IBM
·
Siemens
·
Microsoft
·
Hitachi
·
Cisco
·
Huawei
·
Intel
·
NEC
·
ABB
·
Ericsson
·
Oracle
·
Fujitsu
·
Honeywell
·
AWS
·
Thales
·
Signify
·
GE
·
Google
·
TCS
·
AT&T
·
Nokia
·
Samsung
·
SAP
·
Zencity
·
Itron
·
Others
1.
Global
Smart Cities Market Introduction and Market Overview
1.1. Objectives of the Study
1.2. Global Smart Cities Market Scope
and Market Estimation
1.2.1. Global Smart Cities Overall
Market Size (US$ Bn), Market CAGR (%), Market forecast (2025 - 2035)
1.2.2. Global Smart Cities Market
Revenue Share (%) and Growth Rate (Y-o-Y) from 2021 - 2035
1.3. Market Segmentation
1.3.1. Component of Global Smart Cities
Market
1.3.2. Technology of Global Smart
Cities Market
1.3.3. Solution of Global Smart Cities
Market
1.3.4. Application of Global Smart
Cities Market
1.3.5. Region of Global Smart Cities
Market
2.
Executive Summary
2.1. Demand Side Trends
2.2. Key Market Trends
2.3. Market Demand (US$ Bn) Analysis
2021 – 2024 and Forecast, 2025 – 2035
2.4. Demand and Opportunity
Assessment
2.5. Demand Supply Scenario
2.6. Market Dynamics
2.6.1. Drivers
2.6.2. Limitations
2.6.3. Opportunities
2.6.4. Impact Analysis of Drivers and
Restraints
2.7. Pricing Trends Analysis
2.8. Overview of Technology Developments
2.9. Porter’s Five Forces Analysis
2.9.1. Bargaining Power of Suppliers
2.9.2. Bargaining Power of Buyers
2.9.3. Threat of Substitutes
2.9.4. Threat of New Entrants
2.9.5. Competitive Rivalry
2.10. PEST Analysis
2.10.1. Political Factors
2.10.2. Economic Factors
2.10.3. Social Factors
2.10.4. Technology Factors
2.11. Value Chain / Ecosystem Analysis
2.12. Key Regulation
3.
Global Smart Cities Market Estimates & Historical Trend Analysis (2021 - 2024)
4.
Global Smart Cities Market Estimates & Forecast Trend Analysis, by
Component
4.1. Global Smart Cities Market
Revenue (US$ Bn) Estimates and Forecasts, by Component, 2021 - 2035
4.1.1. Hardware
4.1.2. Software
4.1.3. Services
5.
Global Smart Cities Market Estimates & Forecast Trend Analysis, by
Technology
5.1. Global Smart Cities Market
Revenue (US$ Bn) Estimates and Forecasts, by Technology, 2021 - 2035
5.1.1. IoT
5.1.2. AI & ML
5.1.3. Cloud computing
5.1.4. 5G networking
5.1.5. Edge computing
5.1.6. Others
6.
Global Smart Cities Market Estimates & Forecast Trend Analysis, by
Solution
6.1. Global Smart Cities Market
Revenue (US$ Bn) Estimates and Forecasts, by Solution, 2021 - 2035
6.1.1. Smart governance
6.1.2. Smart economy & development
6.1.3. Smart transportation
6.1.4. Smart monitoring & control
6.1.5. Smart healthcare
6.1.6. Smart & sustainable
environment
6.1.7. Others
7.
Global Smart Cities Market Estimates & Forecast Trend Analysis, by
Application
7.1. Global Smart Cities Market
Revenue (US$ Bn) Estimates and Forecasts, by Application, 2021 - 2035
7.1.1. Transportation
7.1.2. Waste management
7.1.3. Energy management
7.1.4. Utility management
7.1.5. Public safety
7.1.6. Environmental monitoring
7.1.7. Others
8.
Global Smart Cities Market Estimates & Forecast Trend Analysis,
by Region
8.1. Global Smart Cities Market
Revenue (US$ Bn) Estimates and Forecasts, by Region, 2021 - 2035
8.1.1. North America
8.1.2. Eastern Europe
8.1.3. Western Europe
8.1.4. Asia Pacific
8.1.5. Middle East & Africa
8.1.6. Latin America
9.
North
America Smart Cities Market: Estimates & Forecast Trend Analysis
9.1.
North
America Smart Cities Market Assessments & Key Findings
9.1.1. North America Smart Cities Market
Introduction
9.1.2. North America Smart Cities
Market Size Estimates and Forecast (US$ Billion) (2021 - 2035)
9.1.2.1. By Component
9.1.2.2. By Technology
9.1.2.3. By Solution
9.1.2.4. By Application
9.1.2.5. By Country
9.1.2.5.1. The U.S.
9.1.2.5.2. Canada
9.1.2.5.3. Mexico
10. Western Europe Smart
Cities Market: Estimates & Forecast
Trend Analysis
10.1. Western Europe Smart Cities
Market Assessments & Key Findings
10.1.1. Western Europe Smart Cities
Market Introduction
10.1.2. Western Europe Smart Cities
Market Size Estimates and Forecast (US$ Billion) (2021 - 2035)
10.1.2.1. By Component
10.1.2.2. By Technology
10.1.2.3. By Solution
10.1.2.4. By Application
10.1.2.5. By Country
10.1.2.5.1.
Germany
10.1.2.5.2.
Italy
10.1.2.5.3.
U.K.
10.1.2.5.4.
France
10.1.2.5.5.
Spain
10.1.2.5.6.
Benelux
10.1.2.5.7.
Nordics
10.1.2.5.8. Rest
of W. Europe
11. Eastern Europe Smart
Cities Market: Estimates & Forecast
Trend Analysis
11.1. Eastern Europe Smart Cities
Market Assessments & Key Findings
11.1.1. Eastern Europe Smart Cities
Market Introduction
11.1.2. Eastern Europe Smart Cities
Market Size Estimates and Forecast (US$ Billion) (2021 - 2035)
11.1.2.1. By Component
11.1.2.2. By Technology
11.1.2.3. By Solution
11.1.2.4. By Application
11.1.2.5. By Country
11.1.2.5.1.
Russia
11.1.2.5.2.
Hungary
11.1.2.5.3.
Poland
11.1.2.5.4.
Balkan & Baltics
11.1.2.5.5. Rest of E. Europe
12. Asia Pacific Smart
Cities Market: Estimates & Forecast
Trend Analysis
12.1. Asia Pacific Market Assessments
& Key Findings
12.1.1. Asia Pacific Smart Cities Market
Introduction
12.1.2. Asia Pacific Smart Cities Market
Size Estimates and Forecast (US$ Billion) (2021 - 2035)
12.1.2.1. By Component
12.1.2.2. By Technology
12.1.2.3. By Solution
12.1.2.4. By Application
12.1.2.5. By Country
12.1.2.5.1. China
12.1.2.5.2. Japan
12.1.2.5.3. India
12.1.2.5.4. Australia & New Zealand
12.1.2.5.5. South Korea
12.1.2.5.6. ASEAN
12.1.2.5.7. Rest of Asia Pacific
13. Middle East & Africa Smart
Cities Market: Estimates & Forecast
Trend Analysis
13.1. Middle East & Africa Market
Assessments & Key Findings
13.1.1. Middle
East & Africa Smart
Cities Market Introduction
13.1.2. Middle
East & Africa Smart
Cities Market Size Estimates and Forecast (US$ Billion) (2021 - 2035)
13.1.2.1. By Component
13.1.2.2. By Technology
13.1.2.3. By Solution
13.1.2.4. By Application
13.1.2.5. By Country
13.1.2.5.1. UAE
13.1.2.5.2. Saudi
Arabia
13.1.2.5.3. Turkey
13.1.2.5.4. South
Africa
13.1.2.5.5. Rest of
MEA
14. Latin America
Smart Cities Market: Estimates &
Forecast Trend Analysis
14.1. Latin America Market Assessments
& Key Findings
14.1.1. Latin America Smart Cities
Market Introduction
14.1.2. Latin America Smart Cities
Market Size Estimates and Forecast (US$ Billion) (2021 - 2035)
14.1.2.1. By Component
14.1.2.2. By Technology
14.1.2.3. By Solution
14.1.2.4. By Application
14.1.2.5. By Country
14.1.2.5.1. Brazil
14.1.2.5.2. Argentina
14.1.2.5.3. Colombia
14.1.2.5.4. Rest of
LATAM
15. Country Wise Market:
Introduction
16. Competition Landscape
16.1. Global Smart Cities Market Product
Mapping
16.2. Global Smart Cities Market
Concentration Analysis, by Leading Players / Innovators / Emerging Players /
New Entrants
16.3. Global Smart Cities Market Tier
Structure Analysis
16.4. Global Smart Cities Market
Concentration & Company Market Shares (%) Analysis, 2023
17. Company Profiles
17.1. Schneider Electric
17.1.1. Company Overview & Key Stats
17.1.2. Financial Performance & KPIs
17.1.3. Product Portfolio
17.1.4. SWOT Analysis
17.1.5. Business Strategy & Recent
Developments
* Similar details would be provided
for all the players mentioned below
17.2. IBM
17.3. Siemens
17.4. Microsoft
17.5. Hitachi
17.6. Cisco
17.7. Huawei
17.8. Intel
17.9. NEC
17.10. ABB
17.11. Ericsson
17.12. Oracle
17.13. Fujitsu
17.14. Honeywell
17.15. Accenture
17.16. Vodafone
17.17. AWS
17.18. Thales
17.19. Signify
17.20. Kapsch
17.21. Motorola
17.22. GE
17.23. Google
17.24. TCS
17.25. AT&T
17.26. Nokia
17.27. Samsung
17.28. SAP
17.29. TomTom
17.30. AppyWay
17.31. Ketos
17.32. Gaia
17.33. TaKaDu
17.34. FlamencoTech
17.35. XENIUS
17.36. Bright Cities
17.37. Maydtech
17.38. Zencity
17.39. Itron
17.40. Others
18. Research
Methodology
18.1. External Transportations /
Databases
18.2. Internal Proprietary Database
18.3. Primary Research
18.4. Secondary Research
18.5. Assumptions
18.6. Limitations
18.7. Report FAQs
19. Research
Findings & Conclusion
We Market Research senior executive is assigned to each consulting engagement and works closely with the project team to deliver as per the clients expectations.
Market Research Process
We Market Research monitors 3 important attributes during the QA process- Cost, Schedule & Quality. We believe them as a critical benchmark in achieving a project’s success.
One of the key manufacturers of automotive had plans to invest in electric utility vehicles. The electric cars and associated markets being a of evolving nature, the automotive client approached We Market Research for a detailed insight on the market forecasts. The client specifically asked for competitive analysis, regulatory framework, regional prospects studied under the influence of drivers, challenges, opportunities, and pricing in terms of revenue and sales (million units).
The overall study was executed in three stages, intending to help the client meet its objective of precisely understanding the entire market before deciding on an investment. At first, secondary research was conducted considering political, economic, social, and technological parameters to get a gist of the various aspects of the market. This stage of the study concluded with the derivation of drivers, opportunities, and challenges. It also laid substantial emphasis on understanding and collecting data not only on a global scale but also on the regional and country levels. Data Extraction through Primary Research
The second stage involved primary research in which several market players and automotive parts suppliers were contacted to study their viewpoint concerning the development of their market and production capacity, clientele, and product line. This stage concluded in a brief understanding of the competitive ecosystem and also glanced through the strategies and pricing of the companies profiled.
In the final stage of the study, market forecasts for the electric utility were derived using multiple market engineering approaches. This data helped the client to get an overview of the market and accelerate the process of investment.
Business process outsourcing, being one of the lucrative markets from both supply- and demand- side, has appealed to various companies. One of the prominent corporations based out of Japan approached us with their requirements regarding the scope of the procurement outsourcing market for around 50 countries. Additionally, the client also sought key players operating in the market and their revenue breakdown in terms of region and application.
Business Solution
An exhaustive market study was conducted based on primary and secondary research that involved factors such as labor costs in various countries, skilled and technical labors, manufacturing scenario, and their respective contributions in the global GDP. A comparative study of the market was conducted from both supply- and demand side, with the supply-side comprising of notable companies, such as GEP, Accenture, and others, that provide these services. On the other hand, large manufacturing companies from them demand-side were considered that opt for these services.
Conclusion
The report aided the client in understanding the market trends, including country-level business scenarios, consumer behavior, and trends in 50 countries. The report also provided financial insights of crucial players and detailed market estimations and forecasts till 2033.
Smart Cities Market was valued at USD 848.0 Billion in 2025.
Smart Cities Market size will increase at approximate CAGR of 28.2% during the forecasted period.
Major companies operating within the market are Schneider Electric, IBM, Siemens, Microsoft, Hitachi, Cisco and Others.
North America dominates the market with an active share of 49.1%.
Only Three Thousand Four Hundred Ninety Nine US dollar
Only Four Thousand Four Hundred Ninety Nine US dollar
Only Five Thousand Four Hundred Ninety Nine US dollar