How Smart is San Jose? Silicon Valley’s Biggest City Tries to Catch Up with the Digital Future

Two years ago, the city of San Jose set out to address an ironic problem.

The self-proclaimed capital of Silicon Valley was riddled with internet dead zones and home to a widening digital divide for the 28 percent of residents who lacked broadband access at home. That’s despite much-discussed efforts to roll out “Wickedly Fast” public WiFi and woo Google into installing a high-speed fiber network.

It was in this climate, with the city still reeling from shedding more than a fifth of its employees during the recession, that Shireen Santosham took a chance and said yes to Mayor Sam Liccardo’s offer to become San Jose’s first-ever chief innovation officer.

“San Jose as a city had gone through almost a decade of fiscal tightening,” says Santosham, a Harvard-educated former consultant at McKinsey. “Tech in that space had suffered quite a bit.”

But that was then.

In mid-June, the city announced the biggest step yet in a wide-ranging “Smart City Vision”  unveiled in 2016, which aims to both digitize city services and encourage private companies to launch “demonstrations” for technologies like self-driving cars. But such projects require fast Internet connections, which is why the city last month approved a series of new broadband deals with Verizon, AT&T and Sprint vendor Mobilitie to install a so-called “small cell” network funded by an expected $500 million in investment from the companies.

The new small cell network, key to 5G cell phone service that could expedite phone connection speeds between 10 and 100 times current speeds, is the biggest broadband deal of its kind attempted in North America, city officials say.

“We’re right now talking to a number of markets. San Jose kind of leaned in early and said, ‘We want to be a part of this,’” says Jason Porter, AT&T’s Dallas-based vice president of global technology planning. “They wanted to differentiate their city as being a digital-first city.”

Far from a wonky pet project, San Jose Assistant City Manager Kip Harkness says the upgraded infrastructure is a prerequisite for modernizing city functions like permitting, access to public meetings and communication for first responders—especially as residents get more used to on-demand tech services in everyday life.

“How do you go from the Sears version of government to the Amazon Prime model of government?” asks Harkness, who also oversees a new permanent Office of Innovation spearheaded by Liccardo.

In that pursuit, San Jose, like other major metro areas from New York to Los Angeles, must contend with creating new tech-centric regulations from scratch, including fast-moving issues like consumer privacy, data security and corporate surveillance. Without safeguards, critics warn that cities may be walking headfirst into Big Brother-like scenarios dominated by monopolistic tech providers.

Some of those concerns have even been voiced from within the city. Santosham and Liccardo attracted nationwide attention in January, when the pair quit a high-profile federal broadband taskforce that skeptics said was overrun by industry players seeking lax rules and favorable financial arrangements and less control for local governments.

“When you’re talking about complex issues of technology and regulation, it’s often lost on the public just how badly they’re being screwed,” Liccardo told Bloomberg in April.

With a proposal for San Jose’s first citywide data policy due in the fall, the other elephant in the room is whether all the time and money put into smart city technologies—some honed right here in Silicon Valley—can really make a dent in the region’s most daunting quality-of-life issues, like unaffordable housing and perma-gridlocked traffic.

“What cities are looking at is how do we bring more services without spending a lot more money,” says Harry Plant, vice president of social impact at San Jose-based Internet of Things technology company Aeris, one of several industry players represented on the city’s smart city advisory council. “The market is so new that you don’t know whether it’s going to generate 50 percent return or 200 percent return or 500 percent return.”

A New IQ

What makes a city “smart” depends on who you ask.

On one hand are public investments in infrastructure and tech systems that promise relatively straight-forward improvements in the way a city operates or interacts with residents. The city of San Jose, for instance, is among those investing in new energy-saving LED smart lights, sensor-equipped irrigation for public parks, tracking devices that monitor wear and tear on city vehicles and a longer-term digital overhaul of the city permitting process.

The goal is making the city more “user friendly,” Santosham says, “so that it doesn’t feel like you’re stepping back in time when you step in city hall.”

Though such efforts can be expensive, they’re not as nebulous as the vast realm of public-private partnerships, where cities enter into one-off agreements with individual tech providers to pilot or deploy emerging technologies. Global infrastructure firm Arup estimates that “smart urban services” will be a $400 billion-a-year industry by 2020.

Amsterdam, for example, is using parked electric cars plugged into chargers as giant batteries to help power homes. Just over Highway 17, Santa Cruz has become a surprising hotbed for debate about the future of so-called “predictive policing,” which advocates say uses big data to isolate locations likely to become the scene of a crime, but which skeptics say is just new packaging for over-policing in poor or minority neighborhoods.

In San Jose, Santosham says more than 30 companies have approached the city about testing self-driving cars, though only two or three unnamed companies are likely to move ahead this year. Several other high-profile projects remain in limbo, according to a June committee meeting update, including Facebook’s proposed Terragraph WiFi system.

“The demand was overwhelming,” Santosham says of the period after the city’s smart city plan was released in 2016. “We had an incredible amount of interest from companies across the Valley.”

To critics like Adam Greenfield, however, such wide-ranging tech pilot projects on public property are merely a thinly veiled attempt at expanding corporate influence on daily life. The author of the 2013 book Against the Smart City is among those skeptical of the benefits of offering infrastructure providers and developers unprecedented access to consumer data.

Though large tech firms have been quick to offer up hardware, apps and software platforms, the space increasingly attracts criticism for vaguely defined buzzwords, including Silicon Valley standbys like “big data” and “artificial intelligence.”

“I prefer to see it for what it is: the colonisation of everyday life by information processing,” Greenfield wrote in a recent column for The Guardian.

In cities like San Jose, where fraught development politics are often front and center, smart cities can also become yet another front in never-ending battles over how to retrofit Bay Area cities for ballooning populations.

“‘Smart’ is a snazzy political label used by a modern alliance of leftist urbanites and tech industrialists,” sci-fi author and professor Bruce Sterling wrote in The Atlantic earlier this year. “To deem yourself ‘smart’ is to make the NIMBYites and market-force people look stupid.”

Beyond the conflict, though, remains the question of if and how smart city technologies can actually be brought to bear on issues that most impact local residents.

Building a Backbone

In some ways, San Jose’s current status as an upcoming Google expansion city lining up a steady stream of new tech pilot projects seems almost inevitable. Since the semiconductor industry first boomed in the 1980s, the city has positioned itself as the urban capital of Silicon Valley.

Still, San Jose has also struggled with keeping costs down to serve residents across its sprawling geography, not to mention competition with San Francisco for luring affluent tech workers. Though city officials have said Google will not get tax breaks or other financial incentives for a reported 40-acre campus near Diridon Station, San Jose in 2013 offered up $7 million in incentives to Samsung.

As the region’s tech companies continues to expand, the question for the city is how to choose which types of new tech connectivity to prioritize.

“The foundational work is, ‘What do we need to do to build a platform?’” says Plant, of Aeris. “So they’re not just spending money that’s going down a rathole.”

Already, popular privately managed event venues including Avaya Stadium and nearby Levi’s Stadium have been competing to build out smaller-scale networks that promise to provide high-speed Internet, mobile payments and longer-term capabilities like face recognition or virtual reality.

For the city, the focus remains trying to unlock more beneficial aspects of technology without walking headfirst into Big Brother-esque scenarios. Key to Santosham’s efforts with the new 5G network, Santosham said, was getting multiple telecom providers to work together, rather than allowing one mega-owner, while also laying the groundwork for a new $24 million digital inclusion fund.

“We don’t really want only private companies driving the space,” she says of the balance the city increasingly tries to strike with new tech initiatives.

Still, knowing what you don’t want is only half the battle.

The real key for San Jose—and aspiring smart cities everywhere—will be developing longer-term policies able to adapt to both of-the-moment tech fads like electric scooters and serious concerns like data security for residents.

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