Feature Story

Emerging Economies: Crime and the Smart City Solution

by Jason Deign

A major factor propelling the adoption of the Internet of Everything in emerging markets could be the need to discourage criminals.

In 2001 the celebrated science fiction writer Arthur C. Clarke foretold electronic monitoring would virtually phase out professional criminals by 2009. Half a decade later than predicted, there are signs this could finally be starting to happen… although perhaps not where you might expect.

In case you were thinking of stealing a motorbike on your next trip to Vietnam, for example, you might like to know that Setech Viet has released a device that could allow the owner to track you on their iPhone. And in Brazil the government has embarked on moves to make tracking devices compulsory for all new cars.

#62 Emerging Economies Crime And The Smart City Solution by The Network Podcast

In fact, anti-theft and personal security applications are revealing themselves as a major reason behind the growth of machine-to-machine (M2M), Internet of Everything, and smart city initiatives across many emerging economies.

The reason is pretty straightforward, says Nuno Afonso, Custom Research consultant at Analysys Mason: plenty of stuff gets stolen in these places. "Emerging markets generally have higher incidences of crime compared to developed markets," he says.

"So in my view, M2M in emerging regions is clearly driven, in part, by the need to have more security."

Take Brazil. According to published figures, the country's urban centers suffer rates of car theft up to 19 times those of New York City. Even superstar drivers of the stature of Jenson Button, the 2009 Formula One World Champion, have fallen foul of Brazilian carjackers. 

For locals, the main result of living in a country where a vehicle is stolen every 78 seconds is that insurance premiums can be equivalent to a fifth of the value of your car, every year. Unsurprisingly, this high cost of vehicle ownership, combined with the likelihood of theft, has spurned hundreds of technology developers to come up with tracking devices.

Ituran, one of the leaders, offers car trackers from BRLR$43.90 (US$19) a month and motorbike products from R$49.90 ($21). In other emerging markets, however, the business case for tracking is not yet quite so clear-cut.

For instance, Setech Viet might seem to be onto a winner given that there are almost 40 million motorbikes in Vietnam, but, says Afonso: "The limiting factor is that the device is very expensive, around a sixth of the price of a motorbike, and smartphone penetration is quite low."

Nevertheless, there are plenty of other security issues and plenty of other sectors to keep crime-fighting application developers busy across the world's emerging markets. A case in point is South Africa, home to MiX Telematics and DigiCore.

MiX Telematics began life as yet another vehicle tracking company, exporting systems to corporate fleet owners as far afield as Southeast Florida, United States, or Wales, United Kingdom.

In its home market, however, the company is also targeting consumers with a personal safety offering. "It is noteworthy that South Africa has among the highest rates of murders, assaults, and rapes of any country in the world," Afonso points out.

DigiCore, meanwhile, targets a whole range of customer groups through its Ctrack brand, with products for vehicle or workforce tracking, passenger transport, and medium to large fleet operators.

Two product lines, in particular, help to demonstrate the real value of asset tracking in emerging economies. One concerns vehicles and machinery used in industries such as agriculture, construction or mining. The other is in fixed plant such as mobile base stations.

In both cases, the loss of the asset can be significantly aggravated by the additional loss of its cargo or its operational capability. So it is a safe bet that the asset's owner will be interested in introducing technology measures to discourage or eliminate theft or vandalism.

Such measures could also presumably have a knock-on effect on local economies, by securing services and supply chains along with the jobs that depend on them.

And if the Internet of Everything can help emerging economies become safer and richer by eliminating crime, it won't just be Arthur C. Clarke who is smiling.




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