Trend Report 2025: Smart City after the experimental phase – Are we ready for the next step?

Where does Germany stand in terms of smart cities? And how can digital public services become an integral part of municipal services?

We addressed these questions together with Behörden Spiegel in the 2025 Digital State Trend Report.

Digital cities and regions: an interim assessment

Nationwide programmes such as ‘Model Projects Smart Cities’ and ‘Smarte. Land. Regionen’ (Smart Country. Regions) as well as federal state initiatives such as ‘Kommunal. Digital’ (Municipal. Digital), ‘Digitale Modellregionen NRW’ (Digital Model Regions North Rhine-Westphalia) and ‘Starke Heimat Hessen’ (Strong Homeland Hesse) have supported cities, districts and municipalities in testing new digital solutions for urban and regional development in recent years.

This has resulted in a diverse range of solutions, use cases and practical knowledge.

Nevertheless, challenges remain – especially with regard to responsibilities, financing and long-term integration into the municipal landscape. Despite initial euphoria and high expectations of Smart City, many projects have not delivered the hoped-for results.

Where is the added value for urban and regional development?

We have therefore looked at which steps are important after the end of the model projects in order to exploit the potential of Smart City and Smart Region in the long term:

1. separating the wheat from the chaff: defining which infrastructures, services and solutions actually offer added value for urban and regional development. These basic components are essential for integrated development and digital public services.
    
2. Skip stages for more momentum: Municipalities should be empowered to use insights from the model projects to move faster. Challenges must be resolved quickly and mistakes avoided so that development stages of the model projects can be skipped.
    
3. Mirror image: Use digitalisation of public administration: The experiences of digitalising public administration can serve as a valuable basis. Similar issues in relation to governance, implementation and standard development require a corresponding exchange.
4. Break down conceptual boundaries: Smart City is closely linked to administrative modernisation. A separation between digital public services and digital administration could fall behind, since both perspectives are important for users and the administration.
    
5. The right mindset is key: Critical reflection on the approach and results is necessary at all federal levels, especially in municipalities. Honest evaluations are a prerequisite for distinguishing between good and not-so-good solutions.
6. Thinking outside the box: Exchange between municipalities is crucial. Formats such as regional conferences and national networking events promote the exchange of knowledge, strengthen self-confidence and show the diversity of solutions.
    
7. Interfederal cooperation is the way forward: Support from the federal and state governments is needed to create overarching structures that make it possible to find solutions that work and organise the transfer of knowledge. This also enables the further development of framework conditions and standards.

Our approach

We have used a three-phase model to show where Germany's regions stand on the road to digitalisation:

experimental phase

• This is the starting point for many municipalities to address the issue.
• It was driven by trends such as digitalisation, the shortage of skilled workers and climate issues, with funding programmes and model projects providing an incentive to address the issue of smart cities.
• In this phase, municipalities experimented with different forms of work and organisation in order to implement suitable smart city initiatives.

Transfer phase

• Consolidating and expanding the networks and structures that emerged during the experimental phase.
• The aim here is to identify and pursue the proven measures from the experimental phase.
• Successful approaches are scaled up and standards developed to establish long-term strategies.

Establishment phase

• Smart City becomes an integral part of municipal action. 

Most of the regions analysed in Germany are in the transfer phase. The challenge now is to ensure that the smart city and smart region concept does not stop here, but is introduced across the board as a driver of development.

Links and downloads

Trend Report 2025 (PDF, in German)

Previous reports 

Project team: Rebaz Ahmad, Matthias Canzler, Bianca Creutz, Joanna Hüffelmann, Miriam Lovis
 

Latest update 18 March 2025