smart cities: a human-centered approach - deloitte.com · smart cities: a human-centered approach...

Smart cities: A human-centered approach

2018 Engineering and Construction ConferenceJune 20–22, 2018

2018 Engineering and Construction Conference June 20-22, 2018Copyright © 2018 Deloitte Development LLC. All rights reserved. 2

Agenda

Topic Content

Smart City Overview • Drivers, Framework, Evolution

• Client Stories

Success Factors & Funding • Key Observations & Success Factors

• Funding

Internet of Things & Sales Tax • Internet of Things Overview

• Information Value Loop

• Benefits to Consumers

• Transaction Taxation

Smart City

Overview


Five key forces driving smart cities

Smart City | Drivers

2.2B world population by 20501

2.5B in urban residents by 20503

40 hrs/yr = avg. time in traffic in the US4

98M more Americans between 2014 and 20602 50% in Airline Passengers by 20375

43 megacities >10 million residents by 20303 $1T global annual infrastructure deficit6

D+ US infrastructure grade, ACSE7

Unprecedented Urbanization

Trending Green

Safety and Security

Exponential Innovation

Transparent Government

3 UN 2018 Revision of the World Urbanization Prospects4 Texas A&M 2015 Urban Mobility Scorecard5 International Air Transport Association 2017 20-Year Air Passenger Forecast: 6 World Economic Forum: How can we bridge the $1 trillion infrastructure gap?, Oct 2015

1 UN World Population Prospects: The 2017 Revision2 US Census Bureau Projections of the Size and Composition of the U.S. Population: 2014 to 2060, March 2015

7 2017 American Society of Civil Engineers Infrastructure Report Card


1.0 2.0

Emergence of IoT technologies

Overwhelming amounts of data

Strategic roadmaps

Experimental/pilot solutions Using a data-driven

strategy

Focusing on a citizen-centric approach

The journey towards citizen-centricity

Smart City | The Evolution


The journey towards citizen-centricity

Integrated. Intelligent. Intuitive.

Smart City | Enhanced Constituent Experience


Smart City | Smart City Framework

• Start with “why” – outcomes based

• Holistic view

• Focus on “who”

Smart City

Client Stories


Smart City | Client Stories

Netherlands

Amsterdam

Argentina

Buenos Aires

Spain

Santander

USA

Columbus, OH

Integrated Roadmap Innovation Accelerator Responsive CityStrategic Plan / Platform Implementation

• To be the model for connected cities of the future

• To establish an innovation vision and strategy

• To improve maintenance of city assets and responsiveness to citizens

• To improve public service delivery and transform the city

• Developed integrated Smart Columbus roadmap and workstream charters

• Designed and implemented Innovation Accelerator

• Implemented asset management platform

• Developed roadmap and implemented digital technology

• Enabled Smart Columbus to effectively execute against its goals

• Seven innovative ideas produced through public, private, academic collaboration

• Improved operational efficiency, response times, and citizen satisfaction

• Mapped recommendations and began platform development

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Smart City

Success Factors & Funding


NETWORKED LEADERSHIP

COMPELLING BUSINESS CASE

OUTCOMES BASED

INCLUSION AND ACCESS

DYNAMIC APPROACH TO REGULATORY FRAMEWORK

DATA GOVERNANCE

INTEGRATED TECHNOLOGY PLATFORM

Often technology is not the hardest part - alignment with strategic vision, clarity, communication, and continued engagement with stakeholders are essential

Smart City | Success Factors


Government

Funds…

PPPs

37%

Others**

40%

Private Funds*

1%

Public-Private Partnerships

Government Funding

Concession model

Concession–build and operate

Special Purpose vehicle

Joint Enterprise

Other Innovative Funding

*Private funds are the funding done by private companies alone.**Special development funds form a major portion of “others” category

Based on sample survey done by

Frost and Sullivan on 15 smart city projects in 2012

Most adopted smart city funding mechanism

Tax Increments

Green Revolving

Crowdfunding

Contractual partnership

Institutional partnership

Municipal Bonds

Self financing

Industrial Revenue Bonds

Green Bonds

User fees

Special development funds

Capital intensive smart city projects likely require various funding mechanisms to supplement government budgets

Smart City | Funding

Smart City

The Internet of Things (IoT) and Sales Tax


Physical devices and objects intelligently connected

Delivery of the right information to the right place at the right time

Connection of people in more relevant and valuable ways

Individual data streams are processed and analyzed with algorithms

Internet of Things (IoT) refers to a world of intelligent, connected devices that generate data for automating business processes and enabling new services

IoT | What is the Internet of Things?

Things Process

People Analytics


Things ApplicationsAct

Analyze Create

CommunicateAggregate

Standards

Sensors

Network

MagnitudeScope | Scale | Frequency

RiskSecurity | Reliability | Accuracy

TimeTimeliness | Latency

Augmented behavior

Augmented Intelligence

This is a framework for thinking about IoT solutions and is based on recognition that value lies in the DATA generated by sensors and connected devices

IoT | Deloitte’s Information Value Loop


Unique Experience

Surprise and delight the customer

Experience aligned withcustomer passions

Personalization

Tailored shopping experiences

Meaningful recommendations

Speed & Convenience

Optimized shopping experiences

Convenience of payment

Ease of identifying productand location

Consumers are benefitting from IoT right now

IoT| Benefits to Consumers


IoT and tectonic shifts in technology lead to a real redefining of company boundaries

IoT| What Does It Mean?

✓ New products

✓ New markets

✓ New partners, ventures, relationships

✓ New customers

✓ New competitors

✓ Faster change in product mix, focus, strategic direction

✓ New industry implications/concerns

✓ Unclear/undefined marketplace


Not only important to define what it is not, but must also be able to identify what it is!

IoT | Transaction Taxation—What is Being Sold?

Jurisdictions could characterize into

any of the following taxable categories:

• Data storage service

• “Canned” information service, "personalized" information service

• Sale, rental, or access to prewritten software

• Data processing

• “Digital automated service”

• Computer service, computer exchange service

• Communications service

• Digital equivalent to traditional tangible personal property ‘aka’ digital goods


IoT | South Dakota v. Wayfair, Inc. et al. (US Supreme Court)

Suggests the Court may be ready to reconsider the decades old “physical presence nexus standard” required in order for a state or locality to impose a use tax collection duty on a remote seller

Potential fallout if physical presence standard is overturned:• New nexus standard?• How will States respond?−Uniformity? Or a multitude of varying “economic

nexus” thresholds?

−Timeline for compliance?

−Retroactivity?

Single issue is a direct challenge to the current physical presence requirement as the anti-Quillstatute requires sellers that exceed $100,000 or 200 or more separate transactions are required to be registered and remit taxes

In granting certiorari, the Court may be prepared to provide its view on the relevance of the physical presence sale and use tax nexus standard in a 21st Century e-Commerce Environment

Questions?

This presentation contains general information only and Deloitte is not, by means of this presentation, rendering accounting, business, financial, investment, legal, tax, or

other professional advice or services. This presentation is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or

action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor.

Deloitte shall not be responsible for any loss sustained by any person who relies on this presentation.

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smart cities: a human-centered approach - deloitte.com · smart cities: a human-centered approach...

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