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Machina Research forecasts that the growth of the Internet of Things (IoT) will be substantial, but standardization could lead to even more rapid growth. This White Paper examines the impact of a fragmented versus a standards-based approach to the IoT as it relates to the emergence of smart cities. Smart cities were selected specifically because they are a microcosm of the IoT; deployments inevitably touch several separate vertical domains, and involve multiple parties, and diverse IT systems. They are therefore a good illustration of the effects of fragmentation and of the relative merits of various means of addressing it.

The White Paper is aimed at city authorities as well as their technology partners, since the development of smart cities is usually based on a hybrid approach of public-private partnering and planning1. InterDigital, the sponsor of this White Paper, supports and promotes open standards through an open platform for IoT interconnectivity and the controlled sharing of data and analysis.

This White Paper addresses the following questions:

• What is the opportunity cost, or difference, between standard-based and non-standardized environments, as it relates to smart cities?
• What is the cost impact to city managers of ongoing inefficiencies that non-standards-based approaches are causing?
• What impact will the use of non-standards-based approaches cause in terms of not achieving the potential of mass scale for IoT interoperability?
• How are operators affected by not achieving the potential of standardization of IoT in smart cities, as greater IoT revenues depend on increasing volumes and process?

The smart cities domain illustrates the importance of standards in enabling deployment and ensuring best practice; but as a complex and multi-dimensional vertical that crosses boundaries between public and private sectors it also shows the challenges inherent in moving towards standards in an environment characterized by multiple systems, vendors, verticals and stakeholders. For this reason, we have chosen to use it to demonstrate in a quantitative way the impact of a standards-based approach.