Plan IT Valley

  • 11.01.2013
  • Rachel Keeton

A city built from scratch just east of Porto, PlanIT Valley will simultaneously serve as a testing platform for partner companies, smart technologies, innovation centers, and incubators for technology start-ups. Using the company’s unique Urban Operating System™ (UOS), Living PlanIT will manage daily processes and gather data via hundreds of millions of ‘smart’ sensors deployed throughout the city. Thus, the city is intended as a replicable model for potential future cities based on a unique network system.

Living PlanIT has an answer to the question that has dogged designers and technologists for the last two decades. What is a ‘smart city’? For Living PlanIT, a start-up technology company founded by Steve Lewis and Malcolm Hutchinson in 2006, the future of cities is in their organizational model, not in the bricks and asphalt. The parts of cities that you don’t see – the systems, the services, the sensors, and smart grids – play an increasingly ambitious role in urban planning. For Living PlanIT, this unseen side is the backbone of new cities. They’ve developed an integrated system that acts as an operating platform for managing every single aspect of city life. From waste to water to electricity to traffic, Living PlanIT’s UOS allows service providers that historically functioned in a completely independent manner to share information and streamline city management. Say a building catches fire on X Street. Sensors in the building linked to the UOS will automatically detect the fire, notify the fire department, and redirect traffic flows to allow fire trucks to reach the site more quickly.

Unsurprisingly, both Lewis and Hutchinson have backgrounds in IT. Lewis served as General Manager of Market Development and Co-Chair of the Microsoft Business Development Forum until mid-2005. Hutchinson founded a Swiss IT company that became a strategic partner of Microsoft in 2002, which is how the partners originally met. After incorporating Living PlanIT in Switzerland in October 2006, the project became a full-time – and very personal – investment for both men. Beginning as a new process model that would deliver cost-effective and waste-free strategies for construction companies and real estate developers, the project quickly evolved into something much grander: a complete, built-from-scratch intelligent city that could be replicated around the world.

Two years after founding the company, Living PlanIT began buying up land in Parades municipality, just east of Porto, Portugal. Why Portugal? According to Lewis, “The key factors in our decision were European leadership in environment and sustainability, and Portugal’s demonstration of those principles. Portugal has demonstrated that government policy and action have resulted in significant use of renewable energies and innovative solutions for waste and water treatment. Implementation of the Lisbon Strategy through the Portuguese Technological Plan and other similar innovative strategies made Portugal an obvious choice.”1 The warm feelings are mutual. Portugal’s national government responded enthusiastically to the project, making it an official Project of National Interest (PIN) in 2009.2 PIN status benefits the project in the following ways: more flexible and faster land rezoning, reduced corporate taxes, expropriation was put in place to eliminate speculation, and effective government support and assistance is only a phone call away.3

Local government has also been supportive, especially through Celso Ferreira, President of the Municipality of Paredes. Ferreira has been involved in the project since 2007. After seeing aerial photos of three hundred undeveloped hectares outside Porto, Manuel Simas, Microsoft’s Managing Director for Worldwide Automotive, commented that the area was just the right size for an ‘automotive city’. Ferreira and Simas were both enthusiastic about the project, and Simas eventually got in touch with Steve Lewis about a potential collaboration. Throughout the first few months of 2008, Lewis and Fereira met repeatedly to iron out the complexities of building a high-tech city on the undeveloped land. As the plans evolved, it became obvious that more land would be needed in order to realize a potential model for a real intelligent city. Today, the master plan covers 1,670 hectares; about a sixteenth the size of Lisbon. With a range of housing options, small businesses, R&D parks, hotels, schools, restaurants, and community facilities, PlanIT Valley is sort of like a super-smart condensed version of Silicon Valley.
During his two terms in office, Ferreira has focused on high-tech investments as the economic key to the area’s future. “We are close to Porto and we cannot afford to ignore the growing metropolitan area. If we have a project that can increase value and attract companies and creative people to work locally, I think it the best way [to develop]. I prefer to become a hub of creative industries rather than become the outskirts of Porto.”4

Over the last six years, Lewis and Hutchinson have evolved a very clear business plan that takes the traditional public-private-partnership to a whole new level. In this version, – very much a private-private-partnership – hundreds of partners (and eventually thousands) are gathered together in what Lewis calls an ‘integrated ecosystem’ run by Living PlanIT’s UOS. The new business model is very different from a traditional developer’s approach. Instead of coming in, building quickly, and selling out, Living PlanIT has instead created a platform that is then licensed to partners such as Cisco, Accenture, and Buro Happold. They drive the platform themselves, while Living PlanIT earns profits from four revenue channels: an annual partner fee (ranging from 5,000 to 100,000 euros), royalties from UOS usage (ranging from ten to thirty percent of gross revenues), a one percent Living PlanIT participation fee, and a percentage of total sales revenues (ten to thirty percent).5 Ideally, everyone profits: partner companies gain a monopoly on services within the city and benefit from Living PlanIT’s efficient coordination, intellectual property, and operations support. For Living PlanIT, the difficult groundwork is done. At the user-phase, maintenance of the UOS is complimented by continued re-thinking, refinement, and further development.

In this construction, the need for human intervention is very limited. Much like how Mac OS X or Microsoft Windows runs your household computer, the UOS is the central nervous system of an entire city. This nervous system is linked to more than a million sensors throughout the prototype city that are constantly collecting and sending data. All this information is processed by the UOS, and efficient solutions to changing situations are swiftly discharged. In fact, the city is intended to learn from itself. As a prototype, PlanIT Valley is expected to fail in some ways, but also to point the way to realistic solutions for future models. In the near future, those models are expected to help solve the urban overflow problems in China and India.

Interestingly, the architecture and design of this city seem to be matters of little aesthetic importance. In fact, the hexagonal beehive structure underlying the infrastructure was chosen because it is nature’s most efficient form. The pre-fab buildings are also an exercise in efficiency. In many ways, it’s very clear that this is a city built by technologists for technologists. Although Portuguese architects and planners Balonas e Menano were brought on board in 2009 to prepare the master plan, there is little reference here to twentieth century ideas about New Urbanism or vibrant street life. Instead, the designers worked with Living PlanIT to deliver the most technologically advanced transportation options and ‘intelligent’ buildings.

The city’s main target group is researchers working for the R&D branches of the partner companies. Every partner is required to have a physical presence in PlanIT Valley, and this means families following the researchers. According to Lewis: “In other words, the city’s residents will experiment on themselves. They don’t want a campus, they want a city (…) They need to send their kids to school; they need to be entertained. You end up with a brilliant R&D platform – you live in it, you improve it, you market it. If [a customer] says, ‘I want a medical clinic,’ we already have one. We backed into building PlanIT Valley based on customers’ demands.”6 As the city enters the construction phase, meeting those customers’ demands will become an increasing challenge. After all, it’s a lot easier to add program to a CAD drawing than a city made of concrete and conflicting human interests.

1 Living PlanIt, ‘World’s First Urban-Scale Collaboratory’. (Press Release) June 4, 2009.
2 For the criteria which the Portuguese government requires for a project to be classified PIN see:
3 See: R. Eccles, et. al. Living PlanIT. (Harvard Business School: Boston. 2010) p.15.
4 Ibid. p.7.
5 Ibid. p.9.
6 See: