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IoT in Smart Cities Market Value Analysis: What Growth Is Expected Over The Forecast Period?
The iot in smart cities market size has experienced rapid expansion in recent years. This market is projected to grow from $269.36 billion in 2025 to $329.41 billion in 2026, achieving a compound annual growth rate (CAGR) of 22.3%. The historical growth of this market can be attributed to several factors, including urban population growth, government smart city initiatives, the early adoption of smart lighting systems, the necessity for efficient public services, and rising energy consumption in cities.
The iot in smart cities market size is projected to undergo significant expansion in the coming years. It is expected to reach $742.23 billion by 2030, growing at a compound annual growth rate (CAGR) of 22.5%. This growth during the forecast period is attributable to the expansion of smart city investments, the integration of AI driven city analytics, the proliferation of connected transportation systems, a rising focus on sustainability goals, and the adoption of city wide data platforms. Prominent trends for the forecast period include smart infrastructure management, connected urban services, real time city monitoring, intelligent energy management, and smart public safety systems.
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#IoT in Smart Cities Market Growth Drivers And Industry Catalysts
The increasing deployment of 5G technology is anticipated to boost the expansion of the IoT in the smart cities market. As the fifth generation of cellular technology, 5G delivers quicker, smoother, and more adaptable wireless services. This technology serves as a vital enabler for IoT in smart cities, providing a framework to connect a vast array of sensors and actuators while ensuring high energy efficiency and effective data transmission. Consequently, the rising adoption of 5G technology will drive the growth of the IoT in the smart cities market. Supporting this trend, data from the Global Mobile Suppliers Association (GSA), a UK-based nonprofit, revealed in March 2023 that 5G subscribers reached 1.15 billion by the close of 2022, marking an increase of over 530 million from 619 million in the preceding year, signifying an 85.9% year-on-year growth. Currently, 5G subscriptions constitute 10.7% of all global mobile subscriptions, a figure projected to climb to 16% with 1.77 billion subscribers by the end of 2023. These developments underline how the increasing deployment of 5G technology will fuel the advancement of the IoT in the smart cities market.
IoT in Smart Cities Market Categorization By Product Type And Application
The iot in smart cities market covered in this report is segmented –
1) By Component: Solutions, Services
2) By Technology: Bluetooth, Cellular Network, RFID, Other Technologies
3) By Application: Smart Building, Smart Healthcare, Smart Energy, Smart Transportation, Public Safety, Smart Infrastructure, Other Applications
Subsegments:
1) By Solutions: Smart Lighting Solutions, Smart Waste Management Solutions, Smart Transportation Solutions, Smart Water Management Solutions, Smart Energy Management Solutions, Smart Parking Solutions, Smart Environmental Monitoring Solutions
2) By Services: Consulting Services, System Integration Services, Maintenance And Support Services, Managed Services, Data Analytics Services, Training And Education Services
#IoT in Smart Cities Market Trends Influencing Long-Term Demand
Leading companies active in the IoT in the smart cities market are establishing novel business platforms for digital transformation to secure a competitive advantage. Digital transformation involves utilizing digital technologies to profoundly alter and improve diverse facets of business operations, strategic approaches, and interactions with customers. For instance, in July 2025, Vodafone España, a telecommunications firm based in Spain, revealed the introduction of its proprietary IoT platform, intended for enterprises and public administrations. This platform is specifically engineered to facilitate applications for smart cities and public services, encompassing areas such as city management, logistics, water-cycle management, tele-assistance, and emergency services. Vodafone’s IoT offering capitalizes on its expansive NB-IoT network, which already links over 9.3 million devices, thereby providing significant scalability, minimal latency, and power-efficient connectivity.
IoT in Smart Cities Market Company Landscape And Strategic Competition
Major companies operating in the iot in smart cities market are Cisco Systems Inc.; Intel Corporation; The International Business Machines Corporation (IBM); Huawei Technologies Co. Ltd.; Tech Mahindra Limited; Microsoft Corporation; Honeywell International Inc.; Bosch Global Software Technologies Private Limited; Siemens Incorporation; PTC Inc.; ARM Inc.; Schneider Electric SE; Deutsche Telekom AG; Hitachi Ltd.; SAP SE; Dell Technologies Inc.; Samsung SDS Co. Ltd.; Hewlett Packard Enterprise Company LP; Toshiba Corporation; Panasonic Corporation; Sony Corporation; LG Electronics Inc.; Philips Lighting Holding B.V.; Osram Licht AG; Cree Inc.; Acuity Brands Inc.; General Electric Company; Verizon Communications Inc.; AT&T Inc.; Johnson Controls International plc
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IoT in Smart Cities Market Regional Analysis And Leading Geography
Asia-Pacific was the largest region in the IoT in smart cities market in 2025. The regions covered in the iot in smart cities market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
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Wasay has over a decade of experience in market research, data modelling, and analytics, with prior experience at GlobalData and Decision Tree Consulting Services. At The Business Research Company , he leads research operations across syndicated studies, customized consulting engagements, and the Global Market Model platform. His professional experience includes supporting organizations such as Boston Consulting Group, KPMG, and Ernst & Young. Wasay holds a degree in Electronics and Communications Engineering, postgraduate management qualifications from International Management Institute Belgium and Indian School of Business and Entrepreneurship, and completed the Integrated Program in Business Analytics from Indian Institute of Management Indore.