IBM believes that every business - from shipping to banking, would be changed significantly because of blockchain technology and the tech company wants to put its bet on this.
Industry watchers say it's a risky move, given the relative novelty of the technology and the hype surrounding it, but say IBM is well positioned to make it pay off.
Blockchain is a shared digital ledger. An immutable record can be created once data is entered. Cryptocurrency is the area where this technology is mot associated. However, use of the technology is also being explored by many other companies such as Microsoft, JPMorgan Chase, and American Express.
IBM is also exploring the potential of this technology and has deployed over 500 employees completely dedicated to blockchain related projects for use in industries such as shipping, banking, healthcare and food safety. And for further exploring the opportunities of blockchain technology, the company has also tied up with partners such as Columbia University.
According to Josh Olson, an analyst at Edward Jonesm this tactical decision by IBM is a bold one but is not unique for it because it has been at the forefront of adopting new technologies when t hey emerge. But the analyst said that gaining long term success from this technology is not assured for IBM despite the fact it is amongst the earliest tech companies to embrace this technology. IBM had created a solution or Walmart using blockchain technology to enhance the process of food tracking almost two years ago.
"Historically we've seen IBM invest in a technology early with some early promise, but then they've had difficulty commercializing good technologies or innovations at scale," Olson said.
Financial services, shipping and healthcare are the three areas that IBM has identified to the ones where implementation of blockchain technology can potentially bring benefits. The company has however accorded more focus on the financial sector.
However, IBM also conceded that the blockchain technology is not a panacea even though it has put its bet on it. It feels that transforming paper-based tracking systems into digital ones is amongst the most important of the uses of the technology thereby increasing efficiency and data sharing across industries.
For example, the daily back-end operations of financial tech companies and banks can be enhanced by bringing them together with the use of LedgerConnect which is a software based on blockchain technology.
Another example of the use of this technology is TradeLens which has been developed to enhance efficiency of the shipping industry through the minimization of paperwork and elimination of documentation errors often associated with the industry. the program has already lodged over 150 million transactions on its blockchain. Over 4,000 shipping containers are being tracked with the help of this technology.
Similarly, insurance carriers are allowed to directly upload data onto a blockchain platform with the help of IBM’s Insurance Data Link which helps them to show that they are conforming to state regulations. This is another method where blockchain is being used to eradicate burdensome paperwork while which in turn increases efficiency and security.
According to Bridget van Kralingen, SVP of IBM's industry platforms group, one of the most important aspects of adoption of new technology is ease of use.
And Marie Wieck, the general manager of IBM Blockchain, says that it is also important to listen o what the market is saying and establishing a close coordination with customers to identify their needs from the technology.
"We didn't start with a big bang," Wieck said. "We found [blockchain] had real applicability but not just as an extension of our existing products. We had to create something new, so we started experimenting and doing some customer pilots, and we saw there was enough interest to move forward."
(Source:www.money.cnn.com)
Industry watchers say it's a risky move, given the relative novelty of the technology and the hype surrounding it, but say IBM is well positioned to make it pay off.
Blockchain is a shared digital ledger. An immutable record can be created once data is entered. Cryptocurrency is the area where this technology is mot associated. However, use of the technology is also being explored by many other companies such as Microsoft, JPMorgan Chase, and American Express.
IBM is also exploring the potential of this technology and has deployed over 500 employees completely dedicated to blockchain related projects for use in industries such as shipping, banking, healthcare and food safety. And for further exploring the opportunities of blockchain technology, the company has also tied up with partners such as Columbia University.
According to Josh Olson, an analyst at Edward Jonesm this tactical decision by IBM is a bold one but is not unique for it because it has been at the forefront of adopting new technologies when t hey emerge. But the analyst said that gaining long term success from this technology is not assured for IBM despite the fact it is amongst the earliest tech companies to embrace this technology. IBM had created a solution or Walmart using blockchain technology to enhance the process of food tracking almost two years ago.
"Historically we've seen IBM invest in a technology early with some early promise, but then they've had difficulty commercializing good technologies or innovations at scale," Olson said.
Financial services, shipping and healthcare are the three areas that IBM has identified to the ones where implementation of blockchain technology can potentially bring benefits. The company has however accorded more focus on the financial sector.
However, IBM also conceded that the blockchain technology is not a panacea even though it has put its bet on it. It feels that transforming paper-based tracking systems into digital ones is amongst the most important of the uses of the technology thereby increasing efficiency and data sharing across industries.
For example, the daily back-end operations of financial tech companies and banks can be enhanced by bringing them together with the use of LedgerConnect which is a software based on blockchain technology.
Another example of the use of this technology is TradeLens which has been developed to enhance efficiency of the shipping industry through the minimization of paperwork and elimination of documentation errors often associated with the industry. the program has already lodged over 150 million transactions on its blockchain. Over 4,000 shipping containers are being tracked with the help of this technology.
Similarly, insurance carriers are allowed to directly upload data onto a blockchain platform with the help of IBM’s Insurance Data Link which helps them to show that they are conforming to state regulations. This is another method where blockchain is being used to eradicate burdensome paperwork while which in turn increases efficiency and security.
According to Bridget van Kralingen, SVP of IBM's industry platforms group, one of the most important aspects of adoption of new technology is ease of use.
And Marie Wieck, the general manager of IBM Blockchain, says that it is also important to listen o what the market is saying and establishing a close coordination with customers to identify their needs from the technology.
"We didn't start with a big bang," Wieck said. "We found [blockchain] had real applicability but not just as an extension of our existing products. We had to create something new, so we started experimenting and doing some customer pilots, and we saw there was enough interest to move forward."
(Source:www.money.cnn.com)