How does local government work in Israel

Smart cities: potential untapped despite inventiveness

At first glance, the framework conditions for the development of intelligent cities in Israel are excellent. The government has set the goal that all municipalities must become “smart”. The Israeli high-tech sector has worked out many related solutions. According to the database of the non-profit high-tech organization Start-Up Nation Central, around 300 Israeli companies are active in the field of smart city technology.

However, by no means all municipalities are making use of the opportunities that new technology offers in managing and improving the quality of life for their residents. That is the finding of the non-profit organization Israel Smart Cities Institute (ISCI), which aims to promote the application of technologies for intelligent cities. Members of the institute are mainly personalities from a wide range of relevant professions, but it also has three foreign members, including the German computer scientist Otthein Herzog.

As the chairman of the institute, Edna Pasher and institute member Shmuel Ben-Tovim explained to Germany Trade and Invest, there is a deep gap between the well-advanced municipalities that are leading in the implementation of the smart city concept and the majority of the others the situation is dreary.

Tel Aviv is leading - most municipalities are lagging behind

Tel Aviv has made the greatest strides on the way to becoming a smart city. The second largest city in the country, which is also the leading economic and cultural metropolis, is known in particular for its model for digital citizen engagement, DigiTel.

DigiTel works on the principle of a member association, which any city resident aged 13 and over can join and use their membership card for discounts when using city services. According to their personal profile, the members get access to customer-specific services and are provided with personalized information, for example in the case of upcoming repairs to water pipes or road closures.

The fact that 80 percent of eligible city residents have (free) membership in DigiTel is considered a great success. Tel Aviv received the title “Best Smart City” for DigiTel at the World Smart City Expo in Barcelona in 2014. Pasher and Ben-Tovim cite Tel Aviv's northern neighboring city of Herzliya and the port city of Ashdod as examples of other larger Israeli cities that have made good progress in implementing the smart city concept.

In contrast, there are a large number of municipalities that are struggling with intelligent city technology. The main obstacle, according to the ISCI, is usually not of a financial but of an organizational nature. The municipalities in question do not see themselves in a position to initiate the transition to a smart city or are not interested in it for other reasons. This even applies to solutions that can save the local government money, such as computer-controlled, sensor-supported street lighting, which can reduce street lighting costs by 30 to 40 percent.

Unused business potential needs to be tapped

Despite such difficulties, the ISCI experts assume that the smart city concept will increasingly prevail in the coming years. The institute believes that the experience gained with digital communications during the corona epidemic has shown many potential users the benefits of this technology. This will also promote the use of intelligent technology in the municipal sector. One model that has a chance of success is the introduction of such technology by commercial contractors who, if relevant, receive in return a percentage of the cost savings achieved through the reform.

The introduction of fast communication networks, be it mobile 5G technology or optical fiber optic networks, will significantly expand the possibilities of intelligent applications. Meanwhile, the ISCI emphasizes that the untapped potential of smart city technology is considerable even in today's technological framework and offers companies - including foreign ones - business opportunities. Waiting for faster data transmission could lead to missed business opportunities, especially since the transition to super-fast networks in Israel has hardly started and is likely to take several years.

International cooperation of great interest

Business opportunities could also arise through cooperation with Israeli companies in third markets, the size of which exceeds the manageable dimensions of the Israeli market. Israeli technology in the field of intelligent cities is already being used successfully in the world market. The ISCI itself is involved in international cooperation, for example in the European-Chinese project Trans Urban EU-China, in which it is participating as part of the Horizon 2020 framework program.

The institute also establishes contacts between foreign and Israeli partners from the business and academic sectors. At government level, the Ministry of Social Equality is in charge of promoting smart city technology. To this end, the department launched the national project for a digital Israel (National Digital Israel Initiative).

There are 256 municipalities in Israel. 77 of these are classified as cities, i.e. places of residence with a municipality and more than 20,000 inhabitants. There are also 124 so-called regional councils, i.e. smaller towns, usually with fewer than 20,000 inhabitants, and 54 local councils, each uniting a number of smaller towns.