Simple example in a premier US city (#2 by pop, if I remember correctly), Los Angeles, which is famous for its bad traffic: LA now has all of its 4,500 traffic lights synchronized through a single software system. That combined with sensors monitoring traffic means the city can now start manipulating the lights to improve traffic flow:
Now, the magnetic sensors in the road at every intersection send real-time updates about the traffic flow through fiber-optic cables t a bunker beneath downtown Los Angeles, where Edward Yu runs the network. The computer system, which runs software the city itself develoed, analyzes the data and automatically makes second-by-second adjustments, adapting to changing conditions and using a trove of past data to predict where traffic could snarl, all without human involvement.
Wikistrat has run simulations recently that involved looking at the future of urbanization and there have been a lot of fascinating entries exploring how Big Data will revolutionize urban management. This is a basic example but a crucial one, because few things can better scare off potential citizens than uncontrollable traffic problems - and yes, cities are always competing for talent.