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Cities around the world are transitioning toward smarter and more efficient living, marking the end of the third-generation (3G) network era as faster networks rise to the forefront.

The transition to a faster network is being accelerated by the planned shutdown of all 3G networks over the next 12 months by Australia’s major telecommunications providers, which include Telstra, Vodafone, and Optus.

Worldwide, 3G networks are being decommissioned to repurpose their spectrum for 5G technologies.

5G technologies will form an intensifying part of the smart city transition, as with faster connections, those living in cities as well as the businesses operating within them, will be strongly supported by its growing powerful abilities.

Market research provider McKinsey and Company defines smart cities as the fusion of data and advanced smart technology to lower carbon footprints and increase faster more sustainable living.

Several ASX-listed companies in the smart city space include security and smart home technology provider Scout Security (ASX:SCT), fleet service and logistics provider Orcoda (ASX:ODA), and web provider Pentanet (ASX:5GG).

By September 2024, all 3G networks in Australia will be discontinued. Users must undergo substantial technology upgrades to remain relevant in the evolving telecommunications landscape.

Why are smart cities so important?

5G networks, known for their ability to enable advanced cloud computing, robust data analytics, streamlined fleet logistics, and cutting-edge geoinformation systems, are driving the evolution of the smart cities of tomorrow.

In 2020, Deloitte conducted a worldwide smart city survey. It revealed that half of the global population already resides in urban areas, and this percentage is projected to exceed 70 per cent by 2050.

Since their initial introduction in 2017, governments worldwide have actively propelled smart city development into a new era. Currently, there are more than a thousand ongoing smart city projects across the globe.

The burgeoning demand for these cities necessitates the acquisition of more comprehensive real-time data using faster and smarter technologies. This data empowers businesses to respond swiftly with cost-effective solutions.

However, along with these benefits, sustainability concerns have surfaced, including issues like traffic congestion, sluggish internet speeds for high-capacity users, and the use of outdated technologies.

Fortunately, innovative technologies that were once only theoretical are now confidently addressing these concerns, enabling the phase-out of older, less suitable networks like 3G.

How ASX-listed companies are capitalising on the move

Telecommunications company Teltonika Networks asserts that Australian businesses should aim to have their 3G shutdown plans fully established no later than the conclusion of the second quarter of the FY23.

Historical data from 3G shutdowns worldwide has shown that project teams have often been ill-prepared, underestimating the extensive changes required to ensure a seamless transition and avoid business disruptions.

The 14 months leading up to the 3G shutdowns will provide these companies with a crucial window to migrate all their commercial services still reliant on 3G to the more advanced 4G and 5G networks.

Faster internet networks

Source: Pentanet

Leading B2B software search site Capterra has unveiled the findings of its latest smart city study, which gathered responses from more than 1000 residents residing in cities across Australia.

According to the study, a striking 86 per cent of residents expressed strong support for smart city advancements. However, the realisation of these innovations hinges on the availability of faster network connections, such as 4G and 5G.

Pentanet, a Perth-based telecommunications cloud gaming provider listed on the ASX, is actively seizing the opportunity to provide fast and dependable internet services for professionals, gamers, and everyday internet users.

The company is committed to delivering cutting-edge internet services and online experiences to an expanding subscriber base. In March of this year, the company unveiled its strategy to facilitate the deployment of 5G networks throughout Australia.

In an effort to achieve this, the internet provider has entered into a partnership with Cambium Networks to implement a more adaptable transition to 5G. This is made possible through a network-as-a-service (NaaS) agreement, utilising its licensed 5G 26Ghz mmWave Spectrum. The NaaS model will offer predictable monthly costs, allowing the company to adjust the rollout schedule according to its needs.

“The 5G service will increase our offering and capacity, heightening our ability to service and add more on-net users at a higher rate,” 5GG Managing Director Stephen Cornish said.

Smarter mobility

Orcoda (ASX:ODA) - Managing Director, Geoff Jamieson (front)
Source: Orcoda

The advent of 5G is poised to revolutionise the landscape of fleet services and logistics. With its lightning-fast speeds and minimal latency, it empowers real-time monitoring of vehicles and cargo, ushering in a new era of efficiency.

However, a significant challenge arises from the fact that approximately 70 per cent of logistics fleets still rely on outdated 3G technology. Transitioning to 4G and 5G networks is no longer merely an option; it’s an imperative.

One of Australia’s leading logistics solution providers Orcoda employs its fleet technology to more than 7000 vehicles across Australia and it holds major responsibilities in road, rail, mining, and air infrastructure projects.

The company’s Managing Director, Geoff Jamieson, describes the logistics company as a market leader in route optimisation, schedule management, and rostering.

“Orcoda is unique in that all of its developers and support teams are in Australia which provides quicker response times for our customers and ongoing solutions that suit their Australian operations,” he said.

The opportunity to upgrade its systems to 5G aligns with Orcoda’s vision for smart city integration solutions in fleet management. The transition allows for agile decision-making, streamlining operations, and minimising delays.

“Orcoda is working closely with multiple telematics companies to ensure their customers can implement the Orcoda transport management SaaS solution for their future fleet operations in the swap over from 3G to 4G/5G,” Mr Jamieson said.

The company has forged partnerships with world-leading telecommunications companies, including SGS Logistics, Teletrac Navman, and Savills Australia, enabling services like GPS vehicle tracking, smart solutions for supply chain management, and AI optimisation for transportation operations.

Furthermore, in a significant development this year, ODA welcomed its international subsidiary, Future Fleet to facilitate the integration of new technologies.

These include GPS Fleet tracking software, 4G/5G Plug and Go tracker devices, hard-wired GPS fleet tracking solutions, driver fatigue monitoring, asset tracking, refrigerated monitoring solutions, AI-powered driver behaviour cameras, and satellite and solar-powered asset tracking devices.

Orcoda’s tracking systems allow you to monitor a vast range of vehicle data in real time, including speed, location, and odometer with additional advanced features such as geofencing, Here Maps integrations, trip planning, reporting and much more.

Smarter security

Source: Amazon

Capterra’s smart city study also highlighted that sustainability was the most favoured benefit of a smart city, with 39 per cent of respondents acknowledging its importance, closely followed by enhanced security at 30 per cent.

5G smart cities are well-positioned to leverage advancements in private smart home security technology, making use of public cameras, drones, and sensors to relay crucial information during peak periods.

Scout Security has made considerable strides in the smart home security sector since its launch in February 2013. With more than 500,000 smart alarm systems sold, the company has consistently offered some of the most advanced and up-to-date security systems for homes globally.

Scout continues to expand its customer base in the realm of smart home security. Its Scout hub alarm is designed to operate seamlessly, even during internet outages. It not only deters intruders but also integrates with other smart home devices, such as Google and Alexa, while delivering real-time smartphone notifications.

In the company’s April quarterly activities statement, it was noted that there is substantial demand for app-based security systems, maintaining robust growth at more than 50 per cent.

“Scout is uniquely placed as the only white-label DIY security platform in the world that can also offer WiFi Motion Sense,” SCT CEO Ryan McCall said.

“Smart security remains one of the most compelling extensions of the telco core, and based on the successes we’re seeing with our first US partners, we have good reasons to hold a positive outlook for growth in the year ahead.”

Embracing the path to a more intelligent future

Companies in this sector have a prime opportunity to swiftly embrace advanced networks, positioning themselves at the forefront of technology and ensuring its enduring relevance.

Timely execution of this transition will not only optimise maintenance and repair cost efficiencies but also significantly reduce the incidence of disruptions in telecommunications products and services. This proactive approach ensures that technology infrastructure remains resilient and capable of meeting evolving demands, all while safeguarding long-term sustainability and competitiveness.

The advent of fast and intelligent internet connectivity driven by 5G technology is anticipated to generate approximately $3.6 trillion in economic output and create 22.3 million jobs by 2035, as per The World Economic Forum’s White Paper on 5G and industries.

This economic impact could extend to a global value of $13.2 trillion across various industries.

In simple terms, the 5G transition will revolutionise data analysis, enhancing the efficiency and cost-effectiveness of fleet management, logistics, smart home security, and the internet as a whole.

With real-time tracking, improved communication, proactive maintenance, and data-driven decision-making, it stands as a game-changing development that promises businesses significant savings in terms of time, money, and resources.

The real evolution into smart cities begins now.

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