This is part two of a three-part series covering the JetBlue Technology Ventures’ Blockchain In Travel Summit, held last month at Company in New York City. Read the first article here.
Blockchain technology is moving from theory to practice, as startups around the world release production-ready products into the travel ecosystem. JetBlue Technology Ventures recently hosted its inaugural Blockchain In Travel Summit, a gathering of travel professionals and technologists to understand the current and potential impact of distributed ledger technology on travel. Here were some of the day’s highlights for airlines and aviation partners.
Loyyal + Emirates: Loyalty on the blockchain
The startup Loyyal aims to make loyalty programs more affordable and effective by pulling loyalty points, redemptions, and partner reconciliations onto a blockchain. The technology does not replace existing architecture; instead, it’s additive and affordable to set up. Each partner hosts a two-way node (i.e. the device that stores and spreads data on a blockchain) that can issue its own wallets. All nodes on a blockchain are connected to each other and exchange data so they remain up to date; however they can also be permissioned to allow selective access from partners. This means that users can earn and burn across multiple brands, all without extensive integration work by new partners. When it’s easy to redeem points across a spectrum of redemption partners, program members are more satisfied. For airlines, this translates into more satisfied customers as well as a reduced amount of liabilities on balance sheets.
Loyyal has moved into production phase with Emirates Skywards and results so far include:
- Reduced accounting time and expense related to reconciliation
- Reduced IT costs
- Achieved aggressive growth goals
- Created new sources of program revenue
IATA + United: ID management for commercial aviation
The globalization of the supply chain has made it harder to know the true identity of business partners you do business with. In collaboration with United Airlines, IATA tackled the issue of identity with Project DNA — a private, permissioned blockchain based on identity. The objective was to verify the following information around communications between partners in travel:
- Is it really you?
- Did you write this message?
- Is this message intact?
By answering these questions successfully, communications can be verified as trustworthy and credible so business can be transacted more confidently.
Identity is an important component of how airlines yield revenue. For example, identity matters a lot when airlines serve rates to corporate partners, such as travel management companies. Rates must comply with specific contractual terms, so airlines “come up with an offer you’re entitled to and give you that consistent experience” as explained by United’s Soumit Nandi. “The objective is to identify all parties so we can serve the right offers.”
Blockskye + ARC: Enabling next-gen travel
The startup Blockskye builds open-source solutions for customized shared ledgers in travel. It provides inventory booking and transaction management solutions that achieve greater transparency, trust, and efficiency when managing transactions, inventory, and bookings.
In collaboration with Airlines Reporting Cooperation (ARC), the global settlements giant for airlines, Blockskye developed a proof-of-concept to help the industry deliver the best experiences to travelers through smarter data sharing. The secret sauce here is the enormous amount of data that ARC generates from settling transactions. A blockchain provides the architecture necessary to innovate new ways to share this data with other enterprises.
The shared ledger is the technological foundation that guides collaboration and shapes trust around how data is shared among partners in real-time. The end goal is not to replace the GDS but to create a different approach to how data is both captured and shared with other enterprises. The shared ledger becomes the “single source of truth” for innovations around transactions and distribution.
“The vision is a world of an integrated platform. It only works when all the airlines, all the hotels, all the car rentals are a part of this. We’re not trying to get more pipelines or more bottlenecks.” — Blockskye President Michael Share
Blockskye’s latest proof-of-concept relates to large managed travel, payments and corporate travel distribution, as it relates to simple transient itineraries for a major travel management company. Rather than spending $50 to $75 in fees booking a simple itinerary on a corporate tool, Blockskye built a customizable widget that airlines can embed on their websites. The widget appears only to corporate travelers so they can book simple in-policy itineraries on the airline direct channel. This saves companies money and increases satisfaction for travelers.
SITA: Deploying blockchain to solve specific problems
SITA’s Stephane Cheikh and Barry McLaughlin shared two blockchain use cases for the transport industry: FlightChain and TurnChain. Starting with realistic expectations for a clear subset of use cases allowed SITA to build consensus and show how distributed ledger technology works in the real world.
FlightChain is a reference app for exchanging standard flight data via smart contracts, such as departure, arrival, gate, and baggage carousel information among partners. Traditionally, this information has been siloed in private databases controlled by airports. FlightChain aggregates this data to be shared with relevant entities that can benefit from it.
TurnChain helps airlines and airports increase speed and efficiency once an aircraft arrives at the gate. TurnChain uses a camera to capture what’s happening below the wing of the aircraft and then runs that data through an algorithm and image recognition to create a time-stamped record of each plane’s turnaround activities. For example, the arrival and departure times of catering or how long the baggage handlers took to unload the plane. This granular data can then be used to more efficiently manage operations.
“We’re able to gather everything happening around the aircraft. We send those timestamps into our Airport Management System platform to enable the airport and airlines to enhance their operations. We also enrich that structured data to see if we can predict each aspect of turnaround time. Once we have a good prediction, we can send that back to the AMS software.” — SITA’s Stephane Cheikh
Cirravia + Iberia Express: Re-imagining distribution
Cirravia is about “unblocking the travel ecosystem with a zero-cost and open-source mindset” says CEO Kolbeinn Arinbjarnarson. By using distributed ledger technology, the startup aims to drive down the cost of settlement, distribution, and storage.
“The industry is ripe for disruption. We help airlines get rid of legacy [processes] by changing the way we do the plumbing. IT’s about moving from price-based to attributed-based discovery and search.”
Cirravia does this through tokenization, which disassembles travel products and services into smaller components. Once broken down, each individual element can be optimized by re-bundling into customized packages at the passenger level. This facilitates AI-driven retailing at scale. Rather than the airline coming up with specific offers, targeted to broader segments, airlines can let artificial intelligence build and suggest personalized packages to passengers.
Cirravia has been working with Iberia Express on a pilot to push past what the airline’s Chief Commercial Officer Trevor Griffith Martin sees as the “painfully incremental” process of developing on legacy architecture. In February 2018, Cirravia enabled the world’s first tokenized order, which is when the order of record is created on a blockchain and then passed into the legacy system. With the order of record available on a blockchain, it can then be more easily distributed to other ecosystem partners — rather than being trapped in a walled-off legacy environment.
Click here to watch a video recap of the event and save the date for our second Blockchain In Travel Summit — March 18, 2020 in New York City.
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