Business out of data in urban environments

The role of local authorities and cities is undergoing a transformation, and it is becoming more common to regard them as service platforms. One enabler of such development is a transfer from closed to open systems, but also new modes of operation, such as the city as a platform thinking included in the Smart Tampere ecosystem, contribute to this.

It is possible to collect a lot of electronic data on the behaviour and needs of municipal residents. Using artificial intelligence (AI) or augmented reality (AR) tools, such data can be utilised in decision-making and the development of new services. With the help of refined data, the future service needs of municipal residents can be predicted, and services can be personified according to different life situations. When someone is moving, AI can automatically recommend him or her the best residential area and suitable day care centres with openings, or suggest the most sensible jobs etc. in accordance with the user’s personal interests. Cities know their residents increasingly well, and the data offers huge opportunities for different stakeholders to provide new services.

However, enterprises have been slower to seize the opportunities offered by open data than expected. The user data is dispersed between various public and private digital sources, and the creation of major data-based business would require integration of data from several sources. In other words, ground rules and bold initiatives for sharing data are also needed between operators. The creation of new data-based business activities requires examining services from the viewpoint of municipal residents instead of using the data sources as the starting point for service development. Turku with its ‘circular economy of data’ project and Forum Virium Helsinki, with user-oriented open innovation as its mode of operation, are excellent examples of trendsetters.

Use of open data from various sources in applications and services

Open data can be used in different service contexts. Most examples of such applications can be found in financial and taxation services, such as Budjettipeli budget game, with the help of which you can test different models for sharing the financing burden of welfare services between public communities and private citizens. It is based on the data resources of Statistics Finland, the National Institute for Health and Welfare and the Finnish Centre for Pensions. A lot of examples can also be found in map applications, such as the online and mobile service Aaltopoiju, which offers boaters and free-time seafarers exact observation and forecast data on different weather phenomena, such as water level and wave height. Aaltopoiju uses the open data material produced by the meteorological institutes of Finland, Estonia, Sweden and Germany.

The success factors of a business process based on open data

With a view to making business, it is important that applications based on open data have easy-to-use user and customer interfaces. The integration of data and information systems plays a key role in how utilizable the data is. Technological solutions must support the usability of the application. In addition, securing the information security of individuals is a prerequisite for creating profitable business out of open data. When collecting and using personal data of municipal residents, the delicate nature of such data must be taken into account in every stage of the data process.

Below, as an example, we have listed data initiatives related to parking and traffic, including light traffic, that are being planned, in progress or in their final stages in various cities. In the services of Helsinki Region Transport (HRT), the current issues include starting the operation of Länsimetro and the relevant changes, whereas in Tampere the construction of a tramline reforms the transport structure in the Pirkanmaa area and business activities related to that. Identifying the critical missing pieces in services from the point of view of those moving in city areas can serve as a basis when planning new data initiatives. This enables more efficient creation of new, data-based business operations.

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Customer-oriented and comprehensive service solutions

In urban environments, services utilising open data must be based on the customers’ needs, and not only on the needs of individual data-based services. There is already a lot of data available from various sources, but identifying the critical missing data and its open provision may create new value-creation opportunities. Accumulation of data in the various phases of the use of services and business process may create new opportunities, when we learn to refine them to usable form. Therefore, the roles required for the analysis and utilisation of data (e.g. technical implementation and final use) and the operators in a comprehensive ecosystem must be identified to enable value-creation for the final user. It is also important to collect feedback on the use of applications to develop the services.


Antti Ruuska
Business Development Manager, VTT
antti.ruuska(a)vtt.fi
Twitter: @antti_ruuska

Salla Paajanen
Research Scientist, VTT
salla.paajanen(a)vtt.fi
@PaajanenSalla

Katri Valkokari
Research Manager, VTT
katri.valkokari(a)vtt.fi
@valkatti

Antti Knuuti
Key Account Manager, VTT
antti.knuuti(a)vtt.fi

If you want to read more about VTT’s vision regarding smart and sustainable cities, read our new white paper: Let’s turn your Smart City vision into reality. Smart City development is inherently multi-technological and cross-disciplinary, and as an application-oriented research organisation VTT is an ideal partner. We work with the public sector and private companies as well as technology providers in research and innovation activities that expedites the development of smarter cities.  We can guide you from the early phases of vision-creation and concept development to practical implementations of smart outcomes.

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