Hong Kong has the potential to become a showcase smart city
Simon Galpin says Hong Kong is on the right track to becoming a hub for the growing and lucrative business of smart wearables and other devices
Among the new industries that we have seen growing particularly fast in Hong Kong recently is the "Internet of Things" and related businesses.
The Internet of Things refers to the phenomenon in which physical objects are connected to the internet and can "talk" to other objects or devices via radio frequencies and sensor or wireless technologies. In particular, it allows the development of smart-city applications by sharing data across systems.
In the past couple of years, we have assisted an increasing number of overseas-born entrepreneurs engaged in developing smart wearables and other devices linked to the wireless network.
That, I believe, is only the beginning of a long-term trend that will extend to almost every business area and help make people's daily lives easier. The latest establishment of Brinc's IoT Hub, which opened last month at PMQ, is a good example showing the confidence of foreign investors in Hong Kong's Internet of Things industry.
Brinc is a group designed to help Internet of Things start-ups to scale from Hong Kong globally with a one-stop mentorship, investment and training programme. Member start-ups will be posted to its Shenzhen and Guangdong outlets to learn about manufacturing and distribution aspects.
By many measures, Hong Kong is already geared to take advantage of the business opportunities arising from this technology trend.
The city is a leader, for example, in internet and communications technologies. Its mobile subscriber penetration rate exceeds 240 per cent, and the household broadband penetration rate has reached 83 per cent. Smartphone usage is widespread, with statistics indicating that 96 per cent of people use their smartphone to go online every day.
During his budget speech this year, the financial secretary talked about deploying the Internet of Things as part of the "Smarter Hong Kong, Smarter Living" initiative. In his policy address, the chief executive undertook to turn Kowloon East into a showcase for smart-city solutions. This favourable policy environment should allow this technology, and companies leading its development, to succeed.
Another attraction of Hong Kong as a smart-city hub is its proximity to southern China's manufacturing base. Many entrepreneurs are producing smart wearable devices, so being able to prototype them quickly - and get them to market efficiently - is very important. Hong Kong is also an international and tech-savvy place. A good example is the Octopus card, usable on almost all public transport here and accepted by more than 13,000 retail outlets from over 5,800 service providers in Hong Kong, with over 13 million transactions per day.
I am optimistic that Internet of Things applications will continue to widen. In this regard, we are talking about millions, if not billions, of dollars of business value. The pie is too big for us to miss.
The opportunities in Hong Kong for smart-city solutions are endless. By leveraging these latest technologies, Hong Kong has the promise of becoming a showcase smart city and the Internet of Things will be an important driver of economic benefit in the decades to come.
Simon Galpin is director general at Invest Hong Kong