In that particular story, I'd say the level of centralised power evidenced by the ability to manipulate individual traffic signals is as frightening as the quantity of information fed into it. That's not just surveillance, that's top-down control of the functioning of a city.
From technological standpoint it's not that big of a deal. But from civil rights it's horrible, if it was a reported demonstration and the demonstrators were calm.
Modern traffic systems are managed by a centralized hub these days. For example of why, suppose a major accident on a major road. The system can adjust light patterns to help route traffic around the accident, keeping the roads operating as sanely as possible.
