Smart Cities Addressing Global Social Challenges?

Since 2007-8, more than half of the population have been living in cities. Today, however, cities are not able to address global social, economic and environmental challenges, which, in addition, occur in a higher concentration and more intensively in these places. Since the rate of urban population is expected to increase in the future, it is a fundamental interest of mankind to establish and operate cities that are sustainable in all aspects. May the Smart City concept mean a solution for this? And beyond sustainability, can “the cities of the future” reduce social and financial inequalities?  In our paper, we intend to find answers to these questions.

In the 21st century, the everyday life of urban people is almost unnoticeably featured by a growing number of various technical innovations, with the help of which we can manage our time more efficiently, orientate ourselves more easily, obtain information more simply, or pollute our environment to a lesser extent. With the innovations gaining ground, we have new devices that are able to communicate even with each other, allowing more and more activities to be optimised or automated, and we can do more and more by using less and less resources. The final state is the so-called Internet of Things, where objects and people are interconnected. We are at the very beginning of this process, but it is unstoppably taking place around us, and as a result, the boundaries between the “online” and the “offline” world are blurring. More and more technological companies are becoming interested in developing infrastructure with which they evidently participate in, for instance, urban development as well. The competition launched in traffic optimisation and self-driving vehicles is just one of its branches, in which such – at first sight, unusual – participants have appeared as Google or Apple. Today almost all electronics or telecommunications companies (IBM, AT&T, Cisco, Samsung, Microsoft, Oracle, GE, LG, etc.) are engaged in solutions that are specifically designed to optimise urban services. A short, non-exhaustive, demonstrative list of technological companies involved in – as a diversion from their main profiles – city-solution technologies include:


IBM offers a wide range of innovative solutions, from urban planning and city management to infrastructure and social developments. They implement a complex transformation of complete cities into smart cities, uch as the Smart City Malaga project, transportation project in Zhenjiang, or the weather forecasting and emergency monitoring system in Rio de Janiero.

Microsoft’s City Next initiative provides solutions through Zenon automatization software to manage interconnected devices (Internet of Things), and thereby to apply different urban solutions. These services have been utilised in several big cities, from Houston to Los Angeles, and from Utrecht to Shanghai.

Telecommunications company Cisco has developed a monitoring system in Copenhagen to optimise numerous services, from outdoor lighting to managing parking places and waste. The company has developed similar digital monitoring networks in several other cities, from Hamburg to Adelaide and Barcelona.

LG also participates in urban developments, primarily in South-Korean cities (e.g. Seoul, Pusan, Suwon), with energy management and environmental sustainability projects.

Obviously, General Electric primarily supports urban development initiatives with projects related to the energy sector, called “intelligent environments”, and their Predix platform, storing and analysing massive data volumes, also facilitate the optimisation of urban services.

Siemens offers products of intelligent infrastructure: traffic optimisation, enhancement of energy efficiency (in Vienna’s Aspern district), and various other sustainability projects. Parallel to high-tech giants, a kind of competition has commenced between cities; several cities try to become more attractive and more competitive by promoting smart solutions and integrate them as much as possible in the planning phase (e.g. Amsterdam, Singapore, Stockholm, Seoul; on national level: Smart Cities India programme).

Digital technology offers the opportunity to resolve increasingly pressing current urban issues while also respecting people’s private lives. The major challenges and opportunities are included in the table below:

               Challenges                                       Opportunities
High cost of living

occurs when housing demand outpaces developed land and infrastructure.


Modern affordable housing

is enabled by performance-based code, advanced materials, and new ownership models.


Congested commutes

result from decades of sprawl and lack of coordination in transportation demand and supply.

Digital mobility systems

can manage limited road space to improve transportation equity and air quality.


Public health crises

include rising rates of obesity in developed cities and pollution in developing ones.


Personalized social services

can deliver measurable health outcomes while maintaining individual privacy.


Fossil fuel dependency

risks urban resilience and air quality.


Distributed energy management

uses new business models, renewable energy, and smarter storage to improve sustainability.

The Smart City Concept
But what is exactly meant by a smart city?

Smart City means such a settlement that uses available technological opportunities (primarily information and communications technology, ICT) innovatively to promote the creation of a better, more diversified, more sustainable urban environment.  A city is considered “smart” if its investments into human capital, traditional elements of infrastructure (e.g. traffic and transportation), and modern ICT infrastructure drive and encourage sustainable economic growth, and further raise living standards, while also managing natural resources reasonably. Smart cities use smart technology to render their infrastructural systems and services more interconnected, intelligent and efficient.


In the last 200 years, three industrial/technological revolutions took place which significantly transformed, and eventually determined the operations and the structure of today’s modern cities. Each industrial revolution implied huge progress, yet, there was a serious social cost to pay. Currently several authors agree that we stand on the brink of a new, so-called fourth industrial revolution. Its importance is marked by the fact that it was a special topic at the World Economic Forum 2016 in Davos.

The first industrial revolution was the “revolution of steam”; it gave cities rapid transportation, steamships,  and large factories that transformed commerce. But, due to the massive increase in the number of urban workers, it also gave cities the first industrialized slums and the worst air pollution that mankind had ever known.

The second, the electricity revolution gave people lights, subways, and elevators. But electricity also allowed us to block sunlight, retreat to artificial environments, and warehouse people in high-rises.

The third industrial revolution was marked by the spread of automobiles, with the help of which cities started to expand in every direction, providing access to more job opportunities and weekend retreats. But it also gave us sprawl, traffic jams, and smog and nearly killed the central city.

Currently, digital technology is transforming our cities – this is the fourth industrial revolution. Smartphones already shape how people interact with cities. A new set of digital technologies—ubiquitous connectivity, real-time sensors, precise location services, distributed trust, autonomous systems, and digital actuation and fabrication—can collectively transform city life. However, it is a question towards what end they do so. Will they make the city more responsive, equitable, innovative, and human or will they challenge civil liberties and security?

What do smart city solutions include?

Literature refers to the various areas of intervention by sub-systems. The paper entitled “Smart cities”, for example, identifies the following sub-systems as key areas for the operations of a city where the opportunities of using intelligent solutions open up:

  • “People” sub-system (including public safety, health and education);
  • Business sub-system (including political and regulatory environment)
  • Urban services sub-system
  • Transport sub-system
  • Communications sub-system
  • Water management sub-system
  • Energy management sub-system


The Smart City Development Model – Planning Guidelines calls for planning in the following areas: society, human infrastructure, economy, landscape and natural characteristics, system of green areas, built environment, transport, public utilities, environmental protection, disaster prevention, urban climate, administration of self-government, system of instruments and institutions, possible expansion and extension of urban development into the agglomeration.

A study ranking smart cities identifies the following sub-systems:

  • smart economy (competitiveness)
  • smart population (social and human capital)
  • smart governance (participation)
  • smart mobility (transport and ICT infrastructure)
  • smart environment (natural resources)
  • smart residential environment (quality of life).

The same subdivision is used by a collection of international examples.

Smart City interventions mean a complex approach to urban planning; in this case the approach, that is, the mindset is innovative, thus the question what methods should be used for urban development interventions is of great importance. It is a rather interdisciplinary area, requiring high-level cooperation of the classic urban development branch of science and information technology experts.


Smart City in Practice

After this overview of the theoretical framework, we will present to cities demonstrating the Smart City concept is practice.  These two cities embody two different types of Smart Cities. One of them, Songdo, was born on the drawing board. It is a newly built city, where different challenges, including environmental ones, were addressed as early as in the moment of planning, and architectural and technological solutions were applied accordingly. The other example presented here is the historic city of Amsterdam, where a city structure and an infrastructure developed over several hundreds of years are equipped with various technological achievements to address the challenges of the 21st century. Songdo and Amsterdam are the two cities through which we are attempting to answer the question in the focus of our study: are smart Cities able to reduce social inequalities?

The City of Future in South-Korea: Songdo

Songdo IBD (International Business District) is located in South-Korea, on the coast of the Yellow Sea. There are no separate statistical data available on the number of inhabitants of the district; even Gale International was unable to provide relevant figures. What is known is that currently 110,000 people live in Songdo. The number of inhabitants of the international business district does not reach the planned number (250,000), since investments are expected to be actually finished by 2018. The district of an area of six square km is a mere 15-minute drive from Incheon International Airport, and one-third of the world’s population is accessible within a 3 ½ hour flight. In Songdo, a city built from scratch, such an environmentally-friendly city was created by applying advanced technology infrastructure, which is able to adequately address today’s global environmental challenges.

In addition to environmental sustainability, however, city planners also paid attention to the economic one, and, due to its geographical position and the services provided by advanced technologies, Songdo was aimed to be the economic hub of South-East Asia. Regional markets, including China, Japan or Russia are within easy reach from here. This effort is also expressed by the symbol of the city, the Northeast Asia Trade Tower, the tallest building in South Korea. The purpose of the 305-meter tall building is to attract prime global and Korean companies into this international free trade zone.

Songdo was built as part of former South Korean President, Lee Myung-bak’s (2008-2013) drive to promote low carbon-dioxide emission and environmentally sustainable urban growth as basic principles in the development of South Korea. The investment of almost $40 billion has been implemented in a PPP construction as a cooperation between high-tech companies and the local authority to create an environmentally sustainable city, a vivid international economic hub. In 2001, the South Korean government commissioned Gale International, a family-owned and managed real estate development company, with building Songdo. In 2002 the company launched a joint venture with South Korean POSCO E&C, an engineering and construction company engaged in planning and constructing power plants, and in partnership with Incheon Metropolitan City, the three partners started to develop the plans.

Master planning a city has given developers enormous opportunity, since it is easier to plan and implement a flawless city than transforming an existing one. Learning from the mistakes made in architecture in the past, there was the opportunity in the planning phase to construct an energy-efficient, environmentally sustainable city, applying the most advanced technologies as well as relying on solutions in architecture. Songdo brings together green space, accessibility and advanced technology to create an improved way of life.

A green and walking city

40 percent of Songdo’s area is dedicated to green space. In the heart of the city lies Central Park, covering 10 percent of the city, both inspired by and named after Central Park in New York City. Another large green area is an 18-hole championship golf course designed by American golfer Jack Nicklaus. In addition, several smaller parks, public spaces and lots of trees make Songdo greener.

Songdo is a walking city. As a result of conscious architecture, all urban functions are within walking distance from the heart of the city, Central Park. Schools, offices and shops are within a 15-minute walk from here. According to surveys, if people need to walk more than 10-15 minutes they will tend to get in their car. This contributes to significantly reducing the city’s carbon footprint. For those who want to get round the city faster but still in an eco-friendly manner, there is a network of 25 kilometres of bicycle lanes, which is a safe way to get from one place to another. For greater distances, public transport can be used: there is an underground express train that links the development with Seoul, cutting travel time to the South Korean capital down to less than 30 minutes.

In addition to the solutions of architecture, another important element of creating an environmentally sustainable city is applying cutting-edge technological solutions, which make Songdo a smart city. Advanced information and communications network technologies are applied to operate its infrastructure, to improve the city’s quality of life and to provide efficient services. All buildings here form one shared information system: everything, from fire alarm systems to heating and the security system are interconnected.  Consequently, operation is much more cost effective, and, on the other hand, residents can adjust their homes’ temperature, lights, etc. – even remotely. Furthermore, the flexible system result sin efficient energy use, since it goes through and seeks areas of energy use and reduces it wherever possible.

Songdo is taking energy efficiency even further. Homes and various institutions are connected by a telecommunications system – provided by Cisco –, making people available through video installed in TV screens. This further reduces the city’s carbon footprint by curbing people’s need to travel. These innovations are helping reduce energy consumption in each building by 30 percent, compared with traditional operations.

In Songdo, there are no garbage trucks in the streets, since all apartment buildings, offices and street-corner trash cans are connected by an underground system of pipes and trash is automatically sorted and recycled, buried, or burned for fuel. The operation of the waste management system currently requires just seven employees for the entire district.

Sensors and microchips collect data for almost all areas of the operations of the city; these are processed by a central system, aiming to make Songdo’s operation even more efficient, based on the information. Street lights, for example, adjust to the number of pedestrians15 – saving a considerable amount of energy. Traffic lights work in line with real-time needs. Cars are equipped with RFID (Radio Frequency IDentification) tags These sensors will send the geo-location data to the central monitoring unit that will signal black spots or congested areas, and traffic is diverted with the help of traffic lights.

There are several other solutions in the operations of the city which make this urban environment more sustainable. Solar and windforce energy are being currently used to manage the energy demands of the city; rainwater is trapped and used to water parks, wash streets and flush toilets.

To conclude, Songdo aspires to be a model for future cities in which, by the deployment of state-of-the-art technologies, an eco-sustainable urban environment is working, addressing global environmental challenges.


Amsterdam Smart City

Apart from master-planned cities, there are initiatives to transform cities with a history of several hundreds of years along the smart city concept. One example is the capital of the  Netherlands, with a population of roughly 800,000. The Amsterdam Smart City (ASC) initiative is actually the innovations platform of the Amsterdam Metropolitan Area. It launched its operations in 2009, inviting businesses, residents, the municipality and knowledge institutions to suggest and apply innovative ideas and implementations about urban themes. The program is a collaboration between local government officers, private businesses (e.g. KPN, a telecommunications company) and the Amsterdam University of Applied Sciences. The main aim of the initiative is (as they put it) to contribute to the liveability of the city, to curb the emissions of pollutants and energy consumption.

Since the beginnings, they have been cooperating with more than 100 partners, participating in nearly a hundred innovative projects. The entire initiative is encompassed by a website, including the descriptions of all projects and products, in addition blog posts are published, there is a separate section dedicated to communicate the needs/questions regarding intelligent solutions, information about events is shared, and it also functions as the space of knowledge sharing and a community interface. This is the main point of the Amsterdam Smart City concept as well: to involve as many people as possible into the projects, therefore smart projects have been launched in a wide variety of fields, with the involvement of the broadest possible circle of society.

Naturally, the initiative in Amsterdam required an already existing creative/innovative “core”, a social layer that adopts the concept of spreading smart solutions easily. The Amsterdam Smart City programme primarily relies on these innovative initiatives, acting as small, “living labs”; some of them are likely to be only short-lived attempts, but some others may meet real and considerable social needs and act as a template for many other cities of the world.

Developments are grouped in six categories:

  1. Infrastructure & technology: integrated resident alert system (accidents, fires, crimes, etc.); system of hook-ups for electric cars; innovative solutions for using green energy; smart street lights along cycle lanes (switched on by motion; energy is generated by windforce and solar energy); green roofs; community 3D printing R&D project (with international cooperation, also a tourist attraction); homepage collecting all open data (helping other services to increase efficiency).
  2. Energy, water and waste management: cheap loans for sustainability projects; “passive quarter”– a district in Amsterdam in which the energy use of buildings is provided by 100 percent renewable source, resulting in zero carbon-dioxide emission – under construction (expected to be finished by 2021, with a total of 200 apartments); virtual power plant project (storing and small-scale “trading” renewable energy between users in order to optimize the use of capacities), energy atlas (to stimulate the use of renewable energy).
  3. Mobility: smart traffic management systems (to prevent congestions); electric boats (instead of on board diesel generators); zero emission city logistics; tracking system to prevent bicycle theft; smart parking application.
  4. Circular city: re-using building materials, use of bio-based plastic, offices for creative and social enterprises.
  5. Governance and education: social media sites generating smart city-networks; measuring residents’ satisfaction with smart solutions; creating an environment promoting and attracting start-ups with the municipality’s support.
  6. Citizens and living: smart lighting; supporting neighbourhood community initiatives; programmes aiming at assisting/activating senior citizens; online dashboard for participatory urban planning and transformation; programmes supporting a healthy lifestyle.

All these development goals reveal that by implementing the smart city concept, Amsterdam aims at developing improved, more efficient solutions in almost all areas of life, with the active involvement of society.

After this overview of the two cities, now we are examining the impact of the two smart cities on society and trying to find the answer to the question whether they are able to reduce social inequalities.

Can Smart Cities Reduce Social Inequalities?

First of all, we need to clarify the motion of social inequality to examine this question. Social inequality is one of the most extensively researched phenomena, and it has many definitions – however, their systematic overview or comparison is not in the focus of this present paper. We wish to provide a pragmatic definition as a base for our thoughts on the social impact of smart cities. (For those interested in more in-depth theories of the notion, Reinhard Kreckel’s (1982) Class, Status and Power? is recommended.)

By social inequalities, we basically mean the differences between individuals along various dimensions which determine the person’s opportunities for welfare.  The dimensions include qualifications, income, labour market position, place of residence, education, etc. Although these factors cover different aspects of life, together they determine whether a particular person lives in poverty or wealth.

Social inequalities are as ancient as mankind itself, since different resources have never been distributed evenly between people. The extent of inequalities varies in different countries, cultures, due to economic development, social-political regimes and other influencing factors. Generally speaking, as the gap between the poorer and the richer strata widens, social tension also increases, because “over a certain extent, the increase of social inequalities (differentiation of the members of society) prevents social integration, the cooperation between members of according to acknowledged norms and rules, that is, normal social life. An unstable social situation may evolve”. Consequently, it is the interest of the entire society to reduce inequalities.

Smart Cities and Social Inequality – The Case of Songdo

Due to a lack of data, the opportunities to empirically support the statements on the social impacts of smart cities are rather limited. This topic has not yet attracted much research (which is quite explicable, regarding the fact that it is a relatively new phenomenon.) In this light, our standpoint is rather an intuitive hypothesis and not a scientifically grounded fact, to be proven or disproven by future experience. Hence our aim is to generate debate and form some though-provoking ideas.

When examining the case of Songdo, it is important to note that the city was not born as the result of organic, bottom-up development, but it was artificially created top-down by business enterprises. Consequently, its society does not reflect a “natural status”, since “its residents went through a selection process, the fundamental preferences of which focus on knowledge serving the city”. It means such residents have been moving to Songdo who fulfil the functions required to operate the city – developers, researchers, students, businessmen –, and can afford the real estate prices that are higher than those in the capital. Therefore, the population of Songdo, regarding qualifications, income and conditions of living, can be regraded homogeneous, that is, no considerable social inequality can be detected locally.

On national level, however, we can establish that “this type of selection generates significant social exclusion. Citizens with lower level of education and of a lower social status are excluded from the welfare services of the city and the benefits of a ubiquitous information technology”. That is, the technological achievements in Songdo are available to those who have enough money and adequate qualifications to live here. This brings them further advantages, increasing social inequalities within society.

The gap is widened between the residents of Songdo and others living in other Korean settlements by several factors: the city was built with significant state subsidy, (also) financed from the payments of citizens living outside Songdo, while its benefits are enjoyed only by a thoroughly selected stratum of society.  On the other hand, real estate prices in Songdo prevent a wider circle of the Korean society from benefiting from the developed infrastructure and the technological solutions, that is, they suffer a competitive disadvantage compared with the residents of Songdo.

From the city’s viewpoint, however, it is not necessarily viewed as a failure, because it is not Songdo’s aim to reduce social inequalities. It declared its aspiration to become the hub of international companies with its “unmatched quality of life” provided by its infrastructure and its services. “The concept of the first wave of smart cities – including Songdo – does not converge towards social justice but pursue the wellbeing of selected residents”, while keeping environmental aspects in view. Master-planned smart cities, such as Songdo in south Korea, are able to satisfy two of the three dimensions of settlements (economy, natural and built environment, society) to a high standard, but offer no solutions to social issues.

Smart Cities and Social Inequality in the Case of Amsterdam

As opposed to Songdo, Amsterdam has evolved through organic development and it is a city with a history of several hundreds of years – it was inhabited as early as in the Neolithic era. Consequently, its society is heterogeneous, regarding demographical, income and other dimensions, that is, such social inequality exists in Amsterdam that is not present in Songdo, due to various filtering effects, thus the social impact of the smart city concept can be examined locally, within the city.

We can detect several similarities in the smart nature of the two cities. On the one hand, investments have been realized as the result of a cooperation in both cities. In the case of Songdo, local authority and multinational companies, while in the case of the capital of the Netherlands, the municipality, private businesses and the university form partnerships to realize the smart city. On the other hand, eco-sustainability is one of the goals of both cities.

Apart from these, however, the two concepts are fundamentally different. While Songdo intends to be an international economic hub, Amsterdam wants to become a more liveable city for local citizens, that is, the Dutch capital focuses (also) on society. Another important difference is social integration. Songdon is a master-planned city, without any rooted local population, where such developments work that have been designed and implemented from above; while in Amsterdam, the smart city concept wants to address the needs expressed by local people, with the inclusion of local citizens. In our view, this is the guarantee that the application of various technologies will not enhance inequalities between different social groups, but will ultimately result in the reduction of inequalities.  Although the initiatives and ideas are generated by groups more receptive to novelties, the innovations themselves intend to reach a wider circle of society. Examples include programmes focusing on activating senior citizens:  the applied solutions come from younger generations but their aim is to reach retired people.

In our opinion, the impact of the smart city concept on social inequality depends on the context of implementation. In a socially integrated environment where political willingness to involve local people – both in defining problems and devising possible solutions – exists, developing technological innovations may contribute to reducing social inequalities, since, in this case, the needs and problems of groups of a lower social status also appear in the planning phase, and these developments ensuring a competitive  advantage are not accessible by those already living under better conditions. Smart cities like Songdo –  focussing on the development of the economy in addition to the environmental dimension –, are regarded as a kind of technological ivory towers, enhancing inequalities on regional and global level, since their services are available for people with higher levels of education and a (very) good financial status.

Google’s shift from online applications to the “offline” world is remarkable. They have been one of the first companies to develop self-driving cars (and had palpable results around 2012), which have become one of the most dominant trend in the automotive industry, followed by almost all the big manufacturers. In addition, such subsidiaries have appeared (as holdings, which are, together with Google, encompassed by Alphabet, their parent company) such as Calico, a biotech company researching anti-aging drugs, Life Sciences, a healthcare company, Fiber, a high-speed Internet provider, Nest, a home automation producer, and X (earlier Google X), specialized in drone delivery and other programs. Unsurprisingly, the conglomerate is finding “space” for testing, then applying their newest innovations, and for this, cities are the most obvious units.

The Sidewalk Labs project

Google’s Sidewalk Labs initiative is a new type of company, specifically established to work with cities to build products addressing big urban problems. The company creates a platform and a set of urban applications to accelerate innovation in cities around the world before implementing them at scale. Unlike all other smart city concept (and their realization), the activity of Sidewalk Labs is unique due to the concentration of two basic factors at Google: first, they have loads of data available practically on anything – and they can collect further volumes of data potentially more easily than any other company –, and the so-called big data, that is high volumes of data “provided” by various sensors and devices (this is the Internet of Things, IoT), are essential to apply smart devices optimally, because most smart solutions can make processes more efficient, less difficult and less resource-intensive on the basis of these data. Another great advantage Google has is that they have more extensive knowledge and know-how than any other company and are able to implement its ideas in an ever more integrated way, and have vast capacities to improve and develop these. Often technological solutions applied to cities have failed to solve real-world problems, and policy solutions have failed to capitalize on the full potential of technology.  To address this, Sidewalk Labs is building an integrated platform for urban innovation spanning technology, data, policy best practices, relationships, and capital.

The project sees the future of urban planning in the spread of technological innovations. However, there is a gulf to be bridged: while technologists fundamentally are not competent in urban planning, urbanists do not necessarily understand technology. Sidewalk Labs would mean the “marriage” of these two sides, in order to develop the most efficient solutions possible with two different kinds of approach and expertise.

Authors: Ráhel Czirják, László Gere



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