Please ensure Javascript is enabled for purposes of website accessibility

AT&T Inc. Is Teaming Up With the U.S. Government to Expand Smart Cities

By Chris Neiger - Sep 20, 2015 at 8:51AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

AT&T is already knee-deep in smart city technologies, and the new government push will extend the telecom's influence in the space.


A model smart city. Source: AT&T

This week, the White House announced $160 million in new funding and research grants to develop smart cities in the U.S. While that may be a moderate sum of money, it's yet another step the U.S. government is taking to make the Internet of Things (IoT) more of a priority at the local and federal levels.

At the same time, AT&T (T 2.22%) announced that it's now a lead member of the National Institute of Standards and Technology (NIST) and will help the government agency set up smart city projects across the country. 

The company will help bring new smart city technology to 10 U.S. cities, including connected solutions for lighting, transportation, safety, buildings, and parking. Much of the technology involves sensors that can track vehicle traffic, electric meters to monitor energy usage, apps to remotely manage city lighting, and even sensors that can detect gunfire. 

The company will also host a Smart Cities hackathon with the NIST and the participating cities at its Developer Summit this coming January. AT&T hasn't disclosed which cities it will work with, but the move marks a bigger shift toward the potentially lucrative smart city market. 

A bet on smart cities
The company's been building its smart city capabilities and already has 16.5 million smart energy meters in the the U.S. And just last month, the telecom giant teamed up with IBM to implement water sensors in Las Vegas, Atlanta, and Los Angeles. The sensors allow cities to track water usage during droughts and find leaks in old pipelines. The company said in a press release that cities all over the world face water shortages and that a typical pipeline leak can waste 400,000 gallons of water per year.

AT&T is trying to tap into a growing trend among cities to conserve their resources, improve their services, and reduce traffic and crime. According to Navigant Research, by 2023, global smart city technology revenue will hit $27.5 billion, up from $8.8 billion last year.

AT&T is not stopping there
Since January, the company has partnered with more than 136 companies for new IoT projects. Right now, AT&T connects more than 40% of all the connected farm machines in the U.S. and has 22 million IoT connections worldwide, including more than 600,000 connected cars.

As the U.S. government expands funding and research into connected cities, AT&T is in a great position to benefit. Its current projects and new partnership with the NIST make it an ideal carrier to bring more IoT connections to America.

It's still too early to tell how much AT&T could make from smart city technologies, but Cisco Systems thinks the IoT will save the public sector $4.6 trillion between now and 2023. Part of those savings will come from telecoms enabling sensors to connect, monitor, and analyze city data in new ways. Right now, AT&T is leading the pack in bringing those connections, and that should eventually translate into more IoT revenues in the years to come. Just as with most IoT solutions, the promise of future benefits (and earnings) are just around the corner. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

AT&T Inc. Stock Quote
AT&T Inc.
T
$20.28 (2.22%) $0.44
International Business Machines Corporation Stock Quote
International Business Machines Corporation
IBM
$135.03 (1.07%) $1.43
Cisco Systems, Inc. Stock Quote
Cisco Systems, Inc.
CSCO
$49.00 (-1.13%) $0.56

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
345%
 
S&P 500 Returns
119%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/16/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.