The development and operation of smart cities relyheavily on large-scale Internet-of-Things (IoT) networks and sensor infrastructures that continuously monitor various aspects of urban environments. These networks generate vast amounts of data, posing challenges related to bandwidth usage, energy consumption, and system scalability. This paper introduces a novel sensing paradigm called Data-driven Modality Fusion (DMF), designed to enhance the efficiency of smart city IoT network management. By leveraging correlations between timeseries data from different sensing modalities, the proposed DMF approach reduces the number of physical sensors required for monitoring, thereby minimizing energy expenditure, communication bandwidth, and overall deployment costs. The framework relocates computational complexity from the edge devices to the core, ensuring that resource-constrained IoT devices are not burdened with intensive processing tasks. DMF is validated using data from a real-world IoT deployment in Madrid, demonstrating the effectiveness of the proposed system in accurately estimating traffic, environmental, and pollution metrics from a reduced set of sensors. The proposed solution offers a scalable, efficient mechanism for managing urban IoT networks, while addressing issues of sensor failure and privacy concerns.