In recent years, Internet of Things (IoT) has gained presence in all areas of life. Whilst private sector is the forerunner in the adoption of these devices, public sector usage has been lagging. With the rise of smart initiatives, public organizations are increasingly implementing IoT. The necessity to know in which areas of public sector IoT has been implemented and what public value has been derived, has gained importance as reporting of the cost efficiency and benefits of these initiatives has gained attention. This paper seeks to determine the importance of IoT in the public sector from the perspective of public value. IoT implementation in Estonian municipalities was studied to provide concrete data on the use of IoT. Next to efficiency, which is a known goal of IT implementation, the research findings suggest that while IoT has generated public value, there has been a shift in value creation with other outcomes such as effectiveness, transparency and collaboration gaining increased presence. While IoT shows great promise for public value creation, more research is needed to study how public sector can leverage these devices to harvest more benefits than the simple automatization of work processes.