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07 July 2015
An article of Mr. Mathew Smith, Global Head of Strategy and Business Development for Industrial Solutions and Internet of Things of Cisco Systems, who, like last year, will take an active part in the International Industrial Trade Fair INNOPROM (will be held in Ekaterinburg over 8-11 July).

Mr. Smith, the senior expert of Cisco on IoT and “smart” cities, who made a significant contribution to the launch of the project “Smart and safe Kazan City”, will speak on the main plenary session “Industrial efficiency: ways for the goal achievement, experience of different countries”, will participate in the meeting of the Strategic Council for Investment in New Industries affiliated with the Ministry of Trade & Industry of the Russian Federation, and in the work of round tables “Industrial Internet as a reserve for the increase in production efficiency” and “The role of Internet in smart cities development”. In addition he will represent Cisco at the Grand Opening of Innovation Centre under the Ural Federal University and the PROFI Career Guidance Festival.

The world is changing, and it is changing fast. One technological wave changes another on the market. The things will stay the same in the coming years while the developing countries, mass urbanisation and explosive increase in the income of the middle class are growing. Global urbanisation, in its turn, has a strong influence on the allocation of resources, and this will be the crucial determinant of the world’s way to address the challenges it is facing.
Global changes are evident in the fact that the world becomes more connected, that almost everything is becoming connected with everything in the world.  In 2008 a landmark milestone was passed: the number of connected devices exceeded the number of mankind. For the six past years the number of connected people, all kinds of objects, processes and data has doubled and is already amounts to 16 billion and a quarter. And in the next five years, according to the most conservative forecasts, this figure will triple and will reach 50 billion.
Widespread availability of communication resulted in the emergence of the Internet of Everything (IoE), i.e. the network connection of people, processes, data and objects. It terminated the “old” Internet, giving rise to a new one, allowing not only to engage in e-Commerce, but also to create a wide variety of entities that can be called “e-outcomes”.
“E-Outcomes” is the result of the ability to temperate Big Data. However, the simplicity of creating data sources and extracting digital information out of them turns into a fundamental problem: what to do with all these data?
The Big Data challenge lies in the fact that there are too much of them. Therefore, the main task is (after receiving the data) to transform it into information and knowledge, and then, through scenario planning, to make reasonable conclusions on this basis and to derive the economic benefits using them.
Conservative estimates suggest that globally, the potential economic benefits of the IoE in the next decade could reach 19 trillion USD. Where 14.4 trillion dollars are accounted on private business, and 4.6 trillion dollars - on public sector. This economic benefit will be created in a million of different ways. The one we know today is the increase in efficiency of assets and supply logistics, creation of innovative solutions, customers and population service quality increase.
IoE potential benefit in Russia may exceed 271 billion dollars, and it does not include the potential of developing globally applicable solutions. Solutions and applications for data processing, created by talented Russian experts may well become the new “oil” for the country.
Urbanisation will become one of the main generators of Big Data. It is expected that China alone in the next 30 years will add up to 100 cities with a million-plus population. Over the same period, the urban population In India will increase by 400 million people. Against this background, the growth of labour productivity observed in the last 20 years, does not seem so significant in comparison with necessary measures to be taken in view of future changes.
Global urbanisation and the associated unprecedented demand for resources require new approaches, including the use of technologies for “smart” cities. And if a lot has been done for the conceptual development of “smart” cities, the real deployment of “smart” solutions in cities often faces budget constraints and is delayed by the need to resolve “urgent” problems. Cities and whole countries going ahead will benefit not only from the point of view of increasing self-efficacy. They will serve as thought leaders, able to reproduce and export their achievements, forming the core of the new industry around solutions for “smart” cities.

One of the concept supporters is the President of the Republic of Tatarstan, Mr. Rustam Minnikhanov. He took the initiative “Smart and Safe Kazan City”, aimed at the transformation of Tatarstan in the “smartest” region of the Russian Federation, leading in the development of the Internet of Everything and using the unprecedented opportunities that open up when connecting the unconnected. The essence of this project is to create a digital architecture, laid over the physical architecture of Kazan and implemented in the form of a ubiquitous wireless network. It will become a foundation of the digital infrastructure on the basis of which it is planned to provide residents a variety of services. These services will not only improve social and economic situation in Kazan, but also will show an example of beneficial change promotion by the forward-looking leadership.
The first set of services is aimed at strengthening the security and public order in Kazan, at creation of an environment instrumental in foreign direct investment. In addition, these services will facilitate the development of intellectual property, attractive to the international market.
“Smart and Safe Kazan City” project provides for the creation of a unified urban infrastructure of Wi-Fi networks and surveillance, and implementation of the based technical solutions to provide city residents, companies and government agencies various public services. The first line of services will include such solutions as “Safe city”, “Smart parking”, “Smart bus”, “Smart street lighting”, contextual advertising and “Smart housing”. Most of them were developed with the involvement of the community of Russian and Kazan Cisco partners who have shown a capacity for fast innovations with regard to the requirements of the global market.
These solutions are just the tip of the iceberg. The integration of different elements into a single system will help to solve one of the main tasks of Kazan, which consists in transforming the economy into a knowledge-based economy focused on large-scale innovations, increased productivity and improved quality of life.
The project contains a number of target quantitative indicators of strengthening the security and increase efficiency of the city:

  • reducing traffic congestion by 25%;
  • improving the efficiency of public transport usage by 50%;
  • reduction of loss in engineering services by 80%;
  • reduced spending on public lighting by 40%..

There is also a financial element that includes the weakening of the fiscal burden by optimizing the city's expenditures, and the creation of additional work places and sources of revenue for the city treasury.
“Smart and Safe Kazan City” project is self-sustaining and undoubtedly attractive for private investment and public-private partnerships. It will be an example of how the traditional budget financing of capital costs can be changed, when the burden of establishing the infrastructure lies with investors, and the city shifts to a service-oriented digital environment.
Upon the city digitisation the information systems and communication facilities must meet the following criteria:

    • virtualising of services, no need in personal visits to government agencies;
    • increase in the number of custom applications for instant access to services that will enable citizens to interact with government agencies there and then, where and when it suits them;
    • extended introduction of mobile video connection, compared with other types of data transfer (mobile e-mail, instant messaging, web pages), and the acquisition of technological information from various wireless sensors on IP network.


Wi-Fi network based on infrastructure equipment for wireless local area networks will become a platform for providing various services to city residents, companies and government agencies. It is also a part of solution with an integrated infrastructure of complex surveillance and law enforcement in Kazan. The network becomes infinite, seamless, and accessible from anywhere, allowing to create a variety of services.
Mobility is one of the key features, allowing ensuring continuity of communication, especially in cases when it is impossible to use wired data networks. All cities have the standard requirements in daily services; however every city has its own unique settings. Solutions adapted to the specific city can only result from local partnerships.
 One of the fundamental partnerships that have arisen during the implementation of the “Smart and Safe Kazan City” project was the Cisco Innovation Centre specializing in the development of municipal services, created jointly with and on the basis of the Kazan Federal University. The centre will be linked to the growing global network of Cisco Innovation Centres that will allow exchanging ideas and developing smart solutions, attractive for the world market.
The application of the IoE in the oil and gas industry is one of the main potential breakthroughs for the industry of Tatarstan and Russia in general.
 More than two-fold drop of oil prices since June 2014 has become the main topic on the agenda of managers of industrial enterprises, and it also gives a chance for innovative companies to get ahead, using new technologies to reduce the final cost of production, processing and delivery.

Industry experts agree that getting information based on data is a key factor in improving operational efficiency, and data analysis is a No.1 catalyst to accelerate decision making and improve their quality. Three main business benefits are identified today: acceleration of solving problems, improving process control and improving safety in manufacturing.
The companies that will be able to coordinate informational and operational technologies to optimize business processes and improve operational efficiency will be the first in this field. Such companies will become more informed, predictable and manoeuvrable, and will have a chance to become an industry leader.

Effective use of innovative potential requires five key components. First of all, the forward-looking leadership that is evident in Tatarstan.
President R. Minnikhanov has a rare ability to notice the emerging global trends and all the qualities of a leader necessary for their local implementation.
There is the second component, the public-private partnership. The government of Tatarstan has provided opportunities for collaboration with industry, and such companies as Cisco already see the beneficial results.
The next component is a smart regulation, the use of which for encouraging industry to change will be one of the main catalysts for changes in the future. A vivid example of this is the decision of the mayor of San Francisco, which obliged to obtain LEED environmental certificate for all new buildings, mandatory for granting commissioning permit. This resolution was sufficient to create new industry around San Francisco, and the city itself has become a role model for other cities and countries.
The fourth component is the global partner ecosystem. The potential benefits of IoE in the amount of 19 trillion dollars just can't go to only one company, so first of all, we need cooperation.
Finally, the most important component may be the need in open global standards. It is impossible to achieve the full potential of the Internet of Things without universal standards for device discovery and communication between them.
Remember: the Internet itself began with good hundreds of different protocols, the number of which today has been reduced to a minimum. The same thing should happen in the industry, where more than 300 different protocols are used in construction alone.
A huge chance for such standardization is provided by a network where all devices tend to speak the IP language. Industries and companies, first started the conversion, will become leaders, and those who will miss the chance, run the risk to disappear because the depreciation cycles of industrial equipment last for years.

By the way:

About 40% of companies in 12 industries will disappear in the next 5 years as a result of the digital revolution
Connected equipment brings the production to a new level of the Internet of Things
Digital transformation in the oil and gas industry: deep data drilling

Hashtags: Cisco, INNOPROM-2015 exhibition, Internet of Things, IoT, Internet of Everything, IoE, “smart” city, Cisco Innovation Centre, Ural Federal University, UrFU, Kazan Federal University, Republic of Tatarstan.


More information for journalists can be provided by Mr. Alexander Palladin, the Head of the Cisco Press Service in Russia/CIS tel: +7 (985) 226­39­50

Background information of a general nature – tel: +7 (495) 9611410


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