Most people would probably draw a blank when asked to explain the phrase "building a city from the internet up". But get used to the idea, because this is exactly what Google's parent company Alphabet is attempting.
In October 2016, Sidewalk Labs, Alphabet's urban innovation unit, announced plans to transform 16 American conurbations into tech-enabled smart cities. A year down the line, and a huge project is in the offing after Sidewalk Labs signed a deal with the city of Toronto to develop 332 hectares of waterfront land into a connected district.
Reaction to the plans has raised some questions. First and foremost: what does "from the internet up" even mean? Details of the Toronto project are pretty scarce, but Sidewalk Labs' manifesto around "building a district" helps to clarify. It is founded on a system of "ubiquitous connectivity", something Sidewalk Labs is already rolling out through free gigabit Wi-Fi in New York City.
The idea is that once people can connect to the grid, the data about their behaviour will allow future cities to be built on a solid base of evidence about its inhabitants. One that should help ensure the urban planning and development is right first time.
A second question concerns practicalities. Is this a realistic proposition and, if so, what does it mean for the future of design, planning and construction? Many developers, investors and designers will be keeping a close eye on how the Toronto scheme plays out over the coming years. Rolling such a grand plan out into existing global metropolises will require displacement, disruption and tackling complicated urban planning conundrums. It is perhaps telling that Sidewalk Labs has not yet proposed how this would work in practice. This is a tough gig, even for a company such as Alphabet which has access to the cash and software systems and platforms required to make a go of almost anything.
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But let's not write this off as another example of Silicon Valley hype. After all, these companies aren't coming to this cold. Most of them now have vast property portfolios, which they are managing with their own software systems. Now they are taking the next steps. In July 2017, Facebook announced plans for a 1,500-unit social housing scheme at Menlo Park in Silicon Valley. Billionaire Xavier Niel's Paris startup hub Station F is set to launch a 100-apartment co-living space in 2018 to house 600 entrepreneurs.
On the office side, WeWork announced it had raised $760 million (£562m) to focus on designing and developing its own buildings. And with Norman Foster, the architect behind Apple's new $5 billion California HQ, saying he would prefer to work with entrepreneurs rather than developers – "as a rule developers just follow the market while entrepreneurs and enlightened individuals lead it" – it is clear we could be looking at a restructuring of the property industry value chain.
Brandon Weber, chief product officer of software-based leasing platform VTS, believes this could be just the start. "It is not far-fetched to imagine a Google or Facebook saying, 'The real-estate sector is a massive aggregation of data, let's commercialise it. Let's go and build ten million square feet of property and see what happens,'" he says.
"From there, they could easily become slick, efficient developers in their own right and they could dominate the market the way Apple did with cell phones. We could be looking back on where we are today saying, 'Remember when there were all these old-school companies developing buildings? How weird was that?'"
It is now up to the bricks-and-mortar developers to step up to the plate and reclaim their role by accepting technological advances and embracing change. That's a scary business: and when those bets are millions of pounds worth of property investments, then the stakes become very high indeed. But the biggest risk of all is refusing to adapt – choosing to stay put and wait for the inevitable, and scarier, alternative: irrelevance.
Emily Wright is features editor of Estates Gazette
This article was originally published by WIRED UK
