Anything as a service, XaaS, is a business model that we can now frequently find from many businesses. As a result of the digitization of products and services and the global shift to cloud computing, more companies are using ‘as a service as their business model. XaaS is a business model in which users access products, tools, and technologies as a service (SAP, n.d.).
As more technology around blockchain developed and with benefits of blockchain, such as transparency, traceability, and advanced security, more and more companies are implementing blockchain in their business process. Blockchain is indeed a disruptive technology, but at the same time, it is expensive to develop, implement and manage.
What comes out from here is ‘Blockchain as a service (BaaS). BaaS refers to situations where an external service provider provides the necessary template and back-end technology for launching and maintaining a private blockchain network (Medium, 2018). Nowadays, BaaS companies service up to blockchain platforms and tools (Mckinsey, 2019).
Blockchain’s attributes can be defined as follow: Digital ledger, which is about storing the data, and Decentralization, that blockchain does not have just one copy of the ledger. Rather every node has the same copy of the ledger. Immutable that the record cannot be edited or erased. Based on those characteristics, we can distinguish the main offerings from the BaaS in three offerings: Storage that stores data in blockchain framework, Software, and decentralized network. With this decentralized network offering, firms don’t need to develop their own decentralized infrastructure for the blockchain.
According to Fortune business insight (2020), they estimated the BaaS market size to be $1.9 Billion in 2019 and expected to grow to $24.94Biliion by 2027.
For example, of BaaS, IBM offers a BaaS platform called ‘FoodTrust’ that connects farmers, delivery companies, retailers, and consumers in real time by digitizing transaction information using blockchain. Global food companies Walmart and Nestle are already using FoodTrust (Mølgaard, 2019).
Oracle also has engaged in BaaS business with their ‘Autonomous Blockchain Cloud Service’ that offers a cloud ledger platform for smart contracts and blockchain networks (Oracle, 2022).
These days, companies are spending a huge amount of money on their IT spending, but still, many companies are incapable of affording all new technologies and IT infrastructure. Especially blockchain is becoming an important technology for companies, with rising of BaaS, more companies will start adopting blockchain.
References
Fortune Business Insights. (2020, May). Infographics – Blockchain-as-a-Service (BaaS) Market. Www.fortunebusinessinsights.com. https://www.fortunebusinessinsights.com/infographics/blockchain-as-a-service-baas-market-102721
Mckinsey. (2019). Blockchain 2.0: What’s in store for the two ends–semiconductors (suppliers) and industrials (consumers)? McKinsey & Company. https://www.mckinsey.com/industries/advanced-electronics/our-insights/blockchain-2-0-whats-in-store-for-the-two-ends-semiconductors-suppliers-and-industrials-consumers
Mølgaard, J. (2019, August 21). World’s biggest retailers make food production safer with IBM’s blockchain. Nordic Blockchain Association. https://nordicblockchain.com/worlds-biggest-retailers-make-food-production-safer-with-ibms-blockchain/
Oracle. (2022). Managed Enterprise Blockchain Service. Oracle.com. https://www.oracle.com/blockchain/cloud-platform/
SAP. (n.d.). XaaS and subscription business models | Get started with business model innovation | SAP Insight. SAP. Retrieved October 13, 2022, from https://www.sap.com/insights/business-model-innovation-xaas.html#:~:text=XaaS%20is%20a%20broad%20category
