Tag: IBM

IBM-Maersk blockchain alliance cuts oceanic shipping times by 40%

The TradeLens shipping partnership now has 94 partners, despite blockchain skeptics.

Did you just get a TV from Tokyo or flowers from France? Blockchain, that potentially disruptive but much-derided technology, might have helped deliver the goods.

A blockchain-based IBM partnership with global shipping colossus Maersk has now expanded to include 94 partners, Big Blue said Thursday. That includes shippers, customs houses, ports and others that have to wrangle paperwork as containers full of goods move around the world.

The result is shipping times that dropped a whopping 40 percent on average, according to Marie Wieck, who leads IBM’s 1,600-employee blockchain work.

That’s the kind of improvement that every inventory manager and bean-counter in accounting loves. And it ultimately means lower prices for anyone buying that TV or those flowers.

Six decades ago, the standard-size shipping container famously revolutionized shipping. Blockchain could do the same. 

“We believe it has the potential to have the same amount of impact on the process,” Wieck said.

Wait, what’s blockchain again?

Blockchain cuts paperwork-handling hassles by a factor of 10 by making it easier for everyone involved to get bills of lading, sanitary certificates, customs releases, invoices and other necessary documents, Wieck said. Before blockchain’s swifter processing, a “container spent more time in the ports than in the ocean” when shipping flowers from Mombasa, Kenya, to Rotterdam in the Netherlands, she said.

Blockchain lets cooperating companies or people share data — sales transactions or property records, for example — on a shared network of computers. The information is distributed across all of them instead of isolated on just one, an idea called a shared ledger, with encryption technology writing the data to all the systems in an ever-lengthening series of interlinked blocks.

Blockchain bakes trust into transactions because a single database eliminates some he-said, she-said disagreements that ordinarily crop up when multiple parties are trying to reconcile two separate databases. Encryption technology ensures that transactions really are between the parties involved.

The blockchain idea grew out of bitcoin and stores transaction data for all other cryptocurrencies, too. But much of the enthusiasm for blockchain is from its use in other domains, everything from voting and lotteries to ID cards and graphics rendering.

Blockchain skeptics

Still, blockchain has plenty of detractors who think of it as a solution in search of a problem.

Vint Cerf, one of the creators of the internet, tweeted a photo of a flowchart for tackling the issue. The top box in the flowchart states: “Do I need a blockchain?” A single arrow points to another box: “No.”

The chief executive of Western Union, a partner in a high-profile blockchain money-transfer project from startup Ripple, said in June that so far, “it’s still too expensive.”

But TradeLens shows there’s enthusiasm, too. Among its 94 partners are shippers Pacific International Lines and Hamburg Süd; customs authorities in the Netherlands, Saudi Arabia, Singapore, Australia and Peru; and port operators in Philadelphia, Hong Kong, Rotterdam, Halifax, Nova Scotia, and Bilbao, Spain.

IBM rival SAP, a business software maker and another blockchain fan, said that the reality of blockchain is that it’s not a get-rich-quick scheme.

Blockchain is a business network, said Gil Perez, SAP’s senior vice president of products and innovations. “It is critical for multiple companies to come together and agree on a business process, which is lengthening the adoption of blockchain in the enterprise,” he said.

SAP has a blockchain project for shipping, logistics and customs, too, and it’s working with partners including the US Customs and Border Protection agency and shipping company UPS.

Logging a million events per day

That work is in the proof-of-concept stage. IBM’s TradeLens service is part of IBM’s early adopter program, but it’s up and running in the real world. It captures more than a million shipping events each day, 154 million in total so far. 

“We don’t see scalability as a factor at all,” Wieck said.

TradeLens for now has been a closed partnership, but that’s changing. “We’re anticipating opening up general availability for anybody who wants to join later this year,” Wieck said. Cryptocurrencies use public blockchains, which means anyone can operate a node on the network and contribute transactions, but TradeLens uses a more restrictive “permissioned” approach with some controls on participation. It maintains the core blockchain idea of distributing data across multiple servers, though.

Also Thursday, IBM opened a programming interface that will let other companies’ computer systems interact with the blockchain. IBM charges for access to the TradeLens, offering it online as software as a service and sharing revenue with founding partners.

IBM has found it’s needed to make course corrections with TradeLens — for example, in the types of documents stored on the blockchain and the “onboarding” process to enlist new partners. But when done right, the blockchain greases the wheels of commerce.

“When there is real transparency to all data on the chain, you have less disputes because everybody has seamless visibility,” Wieck said. “We feel very comfortable about the model having value for the different types of participants.”  

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IBM Secures $1 Billion Australian Dollar Blockchain Deal

The Australian government has chosen IBM as its central technology partner for the next five years in a deal worth $740 million dollars. The agreement will cover technology services provided to government departments, including services which will use IBM’s automation and blockchain technologies. 

Technology’s Youth Key to the Project

IBM will provide services to federal government departments including defense and home affairs, as well as create platforms to protect citizens’ data. The Australian government estimates the partnership will provide around $100 million AUD worth of savings to its citizens.

Harriet Green, IBM’s Asia Pacific Head, told Bloomberg the “youth of the technology,” alongside the employment of Australians, would be the hallmarks of the new partnership.

IBM Partners With Shipping Giant Maersk To Launch Blockchain Solution For Global Logistics

Reprieve for IBM After Past Failure

The new agreement is significant for IBM after the century-old U.S multinational was criticized over the failed provision of an Australian national census in 2016. Within minutes of its launch, the digitized survey — which was compulsory for Australians — was hit with four major Distributed Denial of Service (DDoS) attacks. The resulting 40-hour outage led to IBM recompensing Australia to the tune of $30 million dollars AUD.

Some experts have criticized the new agreement after the census project failure, including information and communications advisor Dr Wissam Raffoul, who told the Australian Financial Review:

If you engineer a bad experience like the census, why do you expect IBM can do a better service.

There is also a concern that such a major agreement with IBM locks out competitors — risking innovation in the sector.

IBM’s New ‘World’s Smallest Computer’ is Built for Blockchain

IBM’s Blockchain Reach

IBM’s blockchain technology is, however, performing well.

Deutsche Bank and HSBC trialed successful blockchain-based transactions using IBM powered we.trade earlier this week. The tests were the largest yet for the we.trade platform, which is currently partnered with 11 European countries.

The technology company’s blockchain reach isn’t constrained to government and financial services, however. During the Think 2018 Conference in March, IBM revealed the “world’s smallest computer” purpose-built for blockchain technology. The tiny device is designed for electronic tagging, with broad use case applications including tracking in shipping and logistics.

Is Australia right to commit to such a large deal? Should past experiences be forgotten based on IBM’s current blockchain successes? Let us know in the comments below! 


Images courtesy of Shutterstock, Wikipedia Commons, Bitcoinist archives.

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