Blockchain is a technology that is mostly associated with cryptocurrencies such as Bitcoin, Ethereum and countless more. The blockchain technology used in cryptocurrencies, is in essence a decentralized database or ledger that enables the transaction of tokens of value. These tokens of value can be generalized to represent money, data or anything else you can imagine. The major benefits of Blockchain include that the database cant be hacked and has an uptime of theoretically 100%, as the technology is distributed among many computers (tnooz, 2017). Until now, Blockchain technology is mostly used within the financial industry. However, there are many different industries where the Blockchain technology could be applied like for example the Airline industry.
So lets discuss some possible applications of the Blockchain technology in the airline industry that go beyond the exchange of money. At first, tickets of flights can be tokenized by an airline and sold to consumers directly, therefore avoiding electronic marketplaces. Smart contracts could enforce the terms and conditions as well as the payment procedure of the ticket purchase. Beyond that, the airline industry is famous for their loyalty programs. The loyalty program could also be tokenized so that consumers have instant access to their loyalty points and could use them for different airlines that have partnerships. Furthermore, security of information such as crew information, flight manifests and passenger records is vital to the airline industry. Blockchain is beneficial here, as it cant be hacked easily, because the technology is distributed among many different computers that disconnect in case of a breach. Therefore, the Blockchain technology would be ideal for managing and sharing information. At last, the blockchain technology could digitalize maintenance logs that hold information about airplane parts, reparations and any other detail. This would improve maintenance, aircraft security and safety within the airline industry. (Accenture.com, 2017)
The Lufthansa Group is the airline with the highest investment in Blockchain, as they are invested in the Swiss start-up Winding Tree. This start-up wants to create its own digital marketplace for travel in the B2B segment. If successful the Blockchain technology would allow the airline to bypass the middleman and sell directly to the customers, using the Blockchain technology. (Skift, 2017)
Work Cited
Accenture.com. (2017). The Potential of Blockchain for Airlines – Accenture. [online] Available at: https://www.accenture.com/nl-en/insight-potential-blockchain-technology-for-airlines [Accessed 14 Oct. 2017].
Skift. (2017). Lufthansa Partners With a Blockchain Provider in an Investment Worth Testing. [online] Available at: https://skift.com/2017/10/10/lufthansa-partners-with-a-blockchain-provider-in-an-investment-worth-testing/?utm_campaign=Early%20Time%20Zone%20-%20Skift%20Daily%20Newsletter&utm_source=hs_email&utm_medium=email&utm_content=57229739&_hsenc=p2ANqtz-_n1NefmKFHQ8yl5ic0buTWZd7fM_cWl8DgqVISndYIslVJ1Z52qL_H7hpV0TbL4eYbWgLFp5CJERXyDQChf-XAr5y54g&_hsmi=57229739 [Accessed 14 Oct. 2017].
tnooz. (2017). The what, why and how of blockchain in travel. [online] Available at: https://www.tnooz.com/article/applications-of-blockchain-travel/ [Accessed 14 Oct. 2017].
I definitely see potential for the use of blockchain into the airline industry. Looking specifically at tickets and the user data behind these pickets there is already a lot of potential. For example changing flights becomes easier. One of the most potential however is in exchanging tickets between various users. Currently swapping your ticket with other people is not possible. Hell, it is already a nightmare to reschedule your flight without high costs, or change your name on a ticket via an airline. Blockchain could bring a solution here if we can integrate this with a system that is integrated with an airline. This way the technology and system is here to even start a marketplace for ticket swapping for example. As we are working in the blockchain, loyalty programs and other airline features are also available here.
Creating one big solution, a data aggregation center or just a safe network are just steps toward a further goal. I am curious where this would take us.
Thank you for our comment Koen! Exchanging flight tickets would add extreme value to a travel e-commerce platform. There are so many people and businesses that book flights in advance that they don’t attend at the end of the day. This would make the industry more efficient and increase customer satisfaction, as the person not attending the flight can still recoup some of the money spent and the person buying gets a discount.