If you are interested in Smart City technologies and experiences, I strongly recommend the following report from Nesta:
The proposal is similar to how I suggest to build the Smart Grid: Do it bottom-up, empowering the consumer/citizen. In this case, the report justifies that the highest return is on collaborative technologies that allow the citizens to participate and shape the future of their cities.
As is widely mentioned, there is no smart city without smart citizens. Just like there is no smart grid without a smart consumer. Thus, investing in smart people is absolutely necessary for these concepts to succeed.
Sometimes, the industry is driven by a technocratic paradigm, where implementing new technologies is a goal in itself. Obviously, installing sensors or other smart systems is only interesting if it benefits the citizens or the city government by reducing cost, improving prosperity and well-being. However, sometimes this is forgotten; Technology is installed first with the hope that it will bring some good, without the participation of the city dwellers.
Another reason for this technocratic paradigm is if the city development is not done by city planners with a global perspective, but by experts in new technologies. Without a social perspective and a wide understanding of how cities work and evolve, the planning will be lame.
To conclude, I will highlight that although the participation of citizens to build the cities of the future is absolutely necessary, it has to be done correctly. Otherwise, it can be self-defeating.