Smart Cities Market - Global Industry Size, Share, Trends, Opportunity and Forecast, By Smart Utilities, By Smart Governance, By Smart Transportation, By Smart Citizens Service, By Region & Competition, 2021-2031F

Description

The Global Smart Cities Market is projected to expand from USD 819.67 Billion in 2025 to USD 2099.36 Billion by 2031, achieving a CAGR of 16.97%. This market comprises sophisticated urban ecosystems that fuse Information and Communication Technologies (ICT) with the Internet of Things (IoT) to streamline municipal operations, upgrade public services, and elevate the quality of life for citizens. Key factors driving this growth include rapid urbanization, which demands effective resource management, and an increased global necessity for sustainable infrastructure to satisfy environmental goals. Furthermore, substantial government programs focused on modernizing legacy utilities and promoting digital equity provide the necessary capital and regulatory backing required for enduring development, ensuring these changes go beyond temporary technological trends.

Market Overview
Forecast Period	2027-2031
Market Size 2025	USD 819.67 Billion
Market Size 2031	USD 2099.36 Billion
CAGR 2026-2031	16.97%
Fastest Growing Segment	Water Management
Largest Market	North America

Despite these favorable growth drivers, the sector encounters significant obstacles regarding data privacy and cybersecurity, as the collection of sensitive citizen data exposes vulnerabilities to complex cyber threats. Securing these interconnected networks is a crucial challenge for administrators striving to establish public trust in digital systems. Illustrating the magnitude of the infrastructure underpinning these innovations, 5G Americas reported that global 5G wireless connections approached two billion in 2024, highlighting the rapid growth of the low-latency connectivity required to support real-time smart city applications.

Market Driver

Rapid global urbanization and increasing population density serve as the primary catalysts for the Global Smart Cities Market, forcing municipal leaders to embrace digital strategies for resource optimization. As cities grow, the strain on existing infrastructure becomes unmanageable, requiring the adoption of intelligent frameworks to ensure operational efficiency and economic resilience. This demographic shift is substantial; the World Bank's 'Urban Development' overview from April 2024 notes that roughly 56 percent of the global population lives in urban areas, creating an urgent demand for scalable technology services. To address this density, public sectors are funding modernization to avert systemic failures, as evidenced by the U.S. Department of Transportation's March 2024 decision to award USD 50 million to thirty-four technology-focused projects aimed at improving community mobility and logistics via smart infrastructure.

The widespread adoption of IoT, Artificial Intelligence, and 5G connectivity supplies the technical foundation needed to execute these urban strategies, converting raw data into practical insights. By utilizing extensive networks of sensors and AI analytics, city administrators can automate intricate tasks such as real-time traffic management and predictive energy adjustments. This technological layer is scaling quickly to meet the demands of modern metropolitan areas. For instance, the 'Ericsson Mobility Report' from June 2024 indicates that Broadband IoT connections hit 1.6 billion by the end of 2023, reflecting the massive hardware deployment supporting these digital ecosystems. Consequently, the combination of high-speed connectivity and machine learning allows cities to advance beyond simple service delivery toward fully autonomous and responsive public infrastructure.

Market Challenge

Concerns regarding data privacy and cybersecurity present a major restraint on the Global Smart Cities Market. As municipalities accumulate massive volumes of sensitive resident information to refine operations, they increasingly become targets for malicious intrusions. This vulnerability directly impedes market growth by damaging the public trust essential for the successful adoption of digital services. If citizens lack confidence in the security of their personal information, they are likely to resist or opt out of data-driven programs, leading to lower usage rates and delayed project implementation.

Additionally, the financial cost of securing interconnected infrastructure diverts critical capital away from developmental innovation. Administrators are often forced to direct significant portions of their budgets toward defensive measures rather than expanding smart capabilities. Highlighting this precarious situation, the National Association of State Chief Information Officers reported in 2024 that 71% of state Chief Information Security Officers classified the risk of AI-enabled cyber threats as high, revealing a severe lack of confidence in securing modern public systems. This environment of heightened risk necessitates a cautious investment approach, thereby slowing the overall momentum of market expansion.

Market Trends

The widespread integration of city-scale digital twin technologies is transforming urban planning by moving from reactive maintenance to predictive simulation. These virtual replicas enable municipal leaders to model complex scenarios, such as disaster response or traffic congestion, in a risk-free environment prior to physical implementation. Such capabilities are essential for optimizing infrastructure lifecycles and boosting operational resilience against environmental stressors. According to Nvidia's November 2025 article 'Into the Omniverse: How Smart City AI Agents Transform Urban Operations,' the use of street-level AI agents allowed Kaohsiung City to reduce incident response times by 80% through real-time simulations.

Simultaneously, the emergence of decentralized smart energy grids and Virtual Power Plants (VPPs) is reshaping how metropolitan areas manage power consumption. As cities incorporate distributed energy resources like solar and electric vehicle charging stations, traditional centralized grids are being replaced by intelligent, bi-directional networks that automatically balance load volatility. This transition helps stabilize prices by pooling diverse power sources. As reported by the International Energy Agency (IEA) in its October 2025 'Renewable Energy Progress Tracker,' global annual renewable capacity additions reached 683 GW in 2024, underscoring the necessity for these advanced grid management systems to handle the influx of variable clean energy.

Key Market Players

ABB Limited
AGT International
AVEVA Group plc
Cisco Systems Inc
Honeywell International Inc
International Business Machines Corporation
Itron Inc
Kapsch Group
Huawei Technologies Co Ltd
Microsoft Corporation
Oracle Corporation
Osram Gmbh
SAP SE
Schneider Electric SE
Siemens AG
Telensa
Verizon

Report Scope

In this report, the Global Smart Cities Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

Smart Cities Market, By Smart Utilities

Water Management
Waste Management
Energy Management

Smart Cities Market, By Smart Governance

Smart Lighting
Smart Infrastructure
City Surveillance

Smart Cities Market, By Smart Transportation

Intelligent Transportation Systems
Parking Management
Smart Ticketing & Travel Assistance

Smart Cities Market, By Smart Citizens Service

Smart Healthcare
Smart Education
Smart Public Safety
Smart Street Lighting
Others

Smart Cities Market, By Region

North America
- United States
- Canada
- Mexico
Europe
- France
- United Kingdom
- Italy
- Germany
- Spain
Asia Pacific
- China
- India
- Japan
- Australia
- South Korea
South America
- Brazil
- Argentina
- Colombia
Middle East & Africa
- South Africa
- Saudi Arabia
- UAE

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Smart Cities Market.

Available Customizations:

Global Smart Cities Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

1. Product Overview

1.1. Market Definition
1.2. Scope of the Market
- 1.2.1. Markets Covered
- 1.2.2. Years Considered for Study
- 1.2.3. Key Market Segmentations

2. Research Methodology

2.1. Objective of the Study
2.2. Baseline Methodology
2.3. Key Industry Partners
2.4. Major Association and Secondary Sources
2.5. Forecasting Methodology
2.6. Data Triangulation & Validation
2.7. Assumptions and Limitations

3. Executive Summary

3.1. Overview of the Market
3.2. Overview of Key Market Segmentations
3.3. Overview of Key Market Players
3.4. Overview of Key Regions/Countries
3.5. Overview of Market Drivers, Challenges, Trends

4. Voice of Customer

5. Global Smart Cities Market Outlook

5.1. Market Size & Forecast
- 5.1.1. By Value
5.2. Market Share & Forecast
- 5.2.1. By Smart Utilities (Water Management, Waste Management, Energy Management)
- 5.2.2. By Smart Governance (Smart Lighting, Smart Infrastructure, City Surveillance)
- 5.2.3. By Smart Transportation (Intelligent Transportation Systems, Parking Management, Smart Ticketing & Travel Assistance)
- 5.2.4. By Smart Citizens Service (Smart Healthcare, Smart Education, Smart Public Safety, Smart Street Lighting, Others)
- 5.2.5. By Region
- 5.2.6. By Company (2025)
5.3. Market Map

6. North America Smart Cities Market Outlook

6.1. Market Size & Forecast
- 6.1.1. By Value
6.2. Market Share & Forecast
- 6.2.1. By Smart Utilities
- 6.2.2. By Smart Governance
- 6.2.3. By Smart Transportation
- 6.2.4. By Smart Citizens Service
- 6.2.5. By Country
6.3. North America: Country Analysis
- 6.3.1. United States Smart Cities Market Outlook
  - 6.3.1.1. Market Size & Forecast
    - 6.3.1.1.1. By Value
  - 6.3.1.2. Market Share & Forecast
    - 6.3.1.2.1. By Smart Utilities
    - 6.3.1.2.2. By Smart Governance
    - 6.3.1.2.3. By Smart Transportation
    - 6.3.1.2.4. By Smart Citizens Service
- 6.3.2. Canada Smart Cities Market Outlook
  - 6.3.2.1. Market Size & Forecast
    - 6.3.2.1.1. By Value
  - 6.3.2.2. Market Share & Forecast
    - 6.3.2.2.1. By Smart Utilities
    - 6.3.2.2.2. By Smart Governance
    - 6.3.2.2.3. By Smart Transportation
    - 6.3.2.2.4. By Smart Citizens Service
- 6.3.3. Mexico Smart Cities Market Outlook
  - 6.3.3.1. Market Size & Forecast
    - 6.3.3.1.1. By Value
  - 6.3.3.2. Market Share & Forecast
    - 6.3.3.2.1. By Smart Utilities
    - 6.3.3.2.2. By Smart Governance
    - 6.3.3.2.3. By Smart Transportation
    - 6.3.3.2.4. By Smart Citizens Service

7. Europe Smart Cities Market Outlook

7.1. Market Size & Forecast
- 7.1.1. By Value
7.2. Market Share & Forecast
- 7.2.1. By Smart Utilities
- 7.2.2. By Smart Governance
- 7.2.3. By Smart Transportation
- 7.2.4. By Smart Citizens Service
- 7.2.5. By Country
7.3. Europe: Country Analysis
- 7.3.1. Germany Smart Cities Market Outlook
  - 7.3.1.1. Market Size & Forecast
    - 7.3.1.1.1. By Value
  - 7.3.1.2. Market Share & Forecast
    - 7.3.1.2.1. By Smart Utilities
    - 7.3.1.2.2. By Smart Governance
    - 7.3.1.2.3. By Smart Transportation
    - 7.3.1.2.4. By Smart Citizens Service
- 7.3.2. France Smart Cities Market Outlook
  - 7.3.2.1. Market Size & Forecast
    - 7.3.2.1.1. By Value
  - 7.3.2.2. Market Share & Forecast
    - 7.3.2.2.1. By Smart Utilities
    - 7.3.2.2.2. By Smart Governance
    - 7.3.2.2.3. By Smart Transportation
    - 7.3.2.2.4. By Smart Citizens Service
- 7.3.3. United Kingdom Smart Cities Market Outlook
  - 7.3.3.1. Market Size & Forecast
    - 7.3.3.1.1. By Value
  - 7.3.3.2. Market Share & Forecast
    - 7.3.3.2.1. By Smart Utilities
    - 7.3.3.2.2. By Smart Governance
    - 7.3.3.2.3. By Smart Transportation
    - 7.3.3.2.4. By Smart Citizens Service
- 7.3.4. Italy Smart Cities Market Outlook
  - 7.3.4.1. Market Size & Forecast
    - 7.3.4.1.1. By Value
  - 7.3.4.2. Market Share & Forecast
    - 7.3.4.2.1. By Smart Utilities
    - 7.3.4.2.2. By Smart Governance
    - 7.3.4.2.3. By Smart Transportation
    - 7.3.4.2.4. By Smart Citizens Service
- 7.3.5. Spain Smart Cities Market Outlook
  - 7.3.5.1. Market Size & Forecast
    - 7.3.5.1.1. By Value
  - 7.3.5.2. Market Share & Forecast
    - 7.3.5.2.1. By Smart Utilities
    - 7.3.5.2.2. By Smart Governance
    - 7.3.5.2.3. By Smart Transportation
    - 7.3.5.2.4. By Smart Citizens Service

8. Asia Pacific Smart Cities Market Outlook

8.1. Market Size & Forecast
- 8.1.1. By Value
8.2. Market Share & Forecast
- 8.2.1. By Smart Utilities
- 8.2.2. By Smart Governance
- 8.2.3. By Smart Transportation
- 8.2.4. By Smart Citizens Service
- 8.2.5. By Country
8.3. Asia Pacific: Country Analysis
- 8.3.1. China Smart Cities Market Outlook
  - 8.3.1.1. Market Size & Forecast
    - 8.3.1.1.1. By Value
  - 8.3.1.2. Market Share & Forecast
    - 8.3.1.2.1. By Smart Utilities
    - 8.3.1.2.2. By Smart Governance
    - 8.3.1.2.3. By Smart Transportation
    - 8.3.1.2.4. By Smart Citizens Service
- 8.3.2. India Smart Cities Market Outlook
  - 8.3.2.1. Market Size & Forecast
    - 8.3.2.1.1. By Value
  - 8.3.2.2. Market Share & Forecast
    - 8.3.2.2.1. By Smart Utilities
    - 8.3.2.2.2. By Smart Governance
    - 8.3.2.2.3. By Smart Transportation
    - 8.3.2.2.4. By Smart Citizens Service
- 8.3.3. Japan Smart Cities Market Outlook
  - 8.3.3.1. Market Size & Forecast
    - 8.3.3.1.1. By Value
  - 8.3.3.2. Market Share & Forecast
    - 8.3.3.2.1. By Smart Utilities
    - 8.3.3.2.2. By Smart Governance
    - 8.3.3.2.3. By Smart Transportation
    - 8.3.3.2.4. By Smart Citizens Service
- 8.3.4. South Korea Smart Cities Market Outlook
  - 8.3.4.1. Market Size & Forecast
    - 8.3.4.1.1. By Value
  - 8.3.4.2. Market Share & Forecast
    - 8.3.4.2.1. By Smart Utilities
    - 8.3.4.2.2. By Smart Governance
    - 8.3.4.2.3. By Smart Transportation
    - 8.3.4.2.4. By Smart Citizens Service
- 8.3.5. Australia Smart Cities Market Outlook
  - 8.3.5.1. Market Size & Forecast
    - 8.3.5.1.1. By Value
  - 8.3.5.2. Market Share & Forecast
    - 8.3.5.2.1. By Smart Utilities
    - 8.3.5.2.2. By Smart Governance
    - 8.3.5.2.3. By Smart Transportation
    - 8.3.5.2.4. By Smart Citizens Service

9. Middle East & Africa Smart Cities Market Outlook

9.1. Market Size & Forecast
- 9.1.1. By Value
9.2. Market Share & Forecast
- 9.2.1. By Smart Utilities
- 9.2.2. By Smart Governance
- 9.2.3. By Smart Transportation
- 9.2.4. By Smart Citizens Service
- 9.2.5. By Country
9.3. Middle East & Africa: Country Analysis
- 9.3.1. Saudi Arabia Smart Cities Market Outlook
  - 9.3.1.1. Market Size & Forecast
    - 9.3.1.1.1. By Value
  - 9.3.1.2. Market Share & Forecast
    - 9.3.1.2.1. By Smart Utilities
    - 9.3.1.2.2. By Smart Governance
    - 9.3.1.2.3. By Smart Transportation
    - 9.3.1.2.4. By Smart Citizens Service
- 9.3.2. UAE Smart Cities Market Outlook
  - 9.3.2.1. Market Size & Forecast
    - 9.3.2.1.1. By Value
  - 9.3.2.2. Market Share & Forecast
    - 9.3.2.2.1. By Smart Utilities
    - 9.3.2.2.2. By Smart Governance
    - 9.3.2.2.3. By Smart Transportation
    - 9.3.2.2.4. By Smart Citizens Service
- 9.3.3. South Africa Smart Cities Market Outlook
  - 9.3.3.1. Market Size & Forecast
    - 9.3.3.1.1. By Value
  - 9.3.3.2. Market Share & Forecast
    - 9.3.3.2.1. By Smart Utilities
    - 9.3.3.2.2. By Smart Governance
    - 9.3.3.2.3. By Smart Transportation
    - 9.3.3.2.4. By Smart Citizens Service

10. South America Smart Cities Market Outlook

10.1. Market Size & Forecast
- 10.1.1. By Value
10.2. Market Share & Forecast
- 10.2.1. By Smart Utilities
- 10.2.2. By Smart Governance
- 10.2.3. By Smart Transportation
- 10.2.4. By Smart Citizens Service
- 10.2.5. By Country
10.3. South America: Country Analysis
- 10.3.1. Brazil Smart Cities Market Outlook
  - 10.3.1.1. Market Size & Forecast
    - 10.3.1.1.1. By Value
  - 10.3.1.2. Market Share & Forecast
    - 10.3.1.2.1. By Smart Utilities
    - 10.3.1.2.2. By Smart Governance
    - 10.3.1.2.3. By Smart Transportation
    - 10.3.1.2.4. By Smart Citizens Service
- 10.3.2. Colombia Smart Cities Market Outlook
  - 10.3.2.1. Market Size & Forecast
    - 10.3.2.1.1. By Value
  - 10.3.2.2. Market Share & Forecast
    - 10.3.2.2.1. By Smart Utilities
    - 10.3.2.2.2. By Smart Governance
    - 10.3.2.2.3. By Smart Transportation
    - 10.3.2.2.4. By Smart Citizens Service
- 10.3.3. Argentina Smart Cities Market Outlook
  - 10.3.3.1. Market Size & Forecast
    - 10.3.3.1.1. By Value
  - 10.3.3.2. Market Share & Forecast
    - 10.3.3.2.1. By Smart Utilities
    - 10.3.3.2.2. By Smart Governance
    - 10.3.3.2.3. By Smart Transportation
    - 10.3.3.2.4. By Smart Citizens Service

11. Market Dynamics

11.1. Drivers
11.2. Challenges

12. Market Trends & Developments

12.1. Merger & Acquisition (If Any)
12.2. Product Launches (If Any)
12.3. Recent Developments

13. Global Smart Cities Market: SWOT Analysis

14. Porter's Five Forces Analysis

14.1. Competition in the Industry
14.2. Potential of New Entrants
14.3. Power of Suppliers
14.4. Power of Customers
14.5. Threat of Substitute Products

15. Competitive Landscape

15.1. ABB Limited
- 15.1.1. Business Overview
- 15.1.2. Products & Services
- 15.1.3. Recent Developments
- 15.1.4. Key Personnel
- 15.1.5. SWOT Analysis
15.2. AGT International
15.3. AVEVA Group plc
15.4. Cisco Systems Inc
15.5. Honeywell International Inc
15.6. International Business Machines Corporation
15.7. Itron Inc
15.8. Kapsch Group
15.9. Huawei Technologies Co Ltd
15.10. Microsoft Corporation
15.11. Oracle Corporation
15.12. Osram Gmbh
15.13. SAP SE
15.14. Schneider Electric SE
15.15. Siemens AG
15.16. Telensa
15.17. Verizon