IBM says blockchain is about business, not technology
IBM’s Blockchain team are finding that customer discussions on using the technology that are now tending to be about business issues; in many ways the technical problems have been solved and this is a mature area in that respect, says John Palfreyman - Director, Blockchain at IBM Cloud Division.
It still takes hands-on sessions in the lab to get embedded in the customer mindset, but the user cases are becoming apparent anywhere there is a flow of assets that needs to be managed, be it in specific markets like diamond production and sale, or financial services, or government – anywhere where there is a business network. Having proved it in 2016, 2017 is the year that will see it in production, he says.
Researcher Gartner says blockchain itself is currently in the “hype curve” phase and will become a mature business in 5-10 years, but there is no doubt that the interest, particularly among C-level executives and innovators, is there, he says. It is strongest in financial services, where two-thirds of IBM’s work has been, but there are areas of excitement in healthcare, government and industries such as automotive.
IBM highlighted blockchain as one of its key emerging area in the latest quarterly results discussion. IBM chairman, president and CEO Ginni Rometty: "In 2016, our strategic imperatives grew to represent more than 40% of our total revenue and we have established ourselves as the industry's leading cognitive solutions and cloud platform company. Emerging solutions such as IBM Blockchain are enabling new levels of trust in transactions of every kind. More and more clients are choosing the IBM Cloud because of its differentiated capabilities, which are helping to transform industries, such as financial services, airlines and retail."
And it is certainly becoming an area of interest to partners and resellers, says John Palfreyman. Channels and partners have been involved from the start, he says and, by its nature, this is a global business and needs corresponding supply coverage. In the client organisation it usually needs some sort of transformation champion to lead – it is certainly not a technical department project as it needs both guidance and buy-in from all levels and parts of the client organisation.
A possible fly in the ointment is the regulatory environment, but so far the regulator has not been particularly active, just keeping an interest in the way it is developing, adds Matt Lucas, Blockchain Global Enablement, CTO Office Europe at IBM. It might be important to continue to differentiate the technology from Bitcoin, which seems to be being described as a similar technology by consumer media. Blockchain is an advanced and sophisticated concept, built on a business network and connections, and just entering the mainstream. It is worth considering that Cisco too has just announced standards and partners for Blockchain, but so far, it is IBM that has been making all the high level statements.
As Martin Schroeter – IBM Senior Vice President and Chief Financial Officer told analysts recently: “Blockchain will help to fundamentally reengineer business processes and improve outcomes. Blockchain increases transparency, auditability and trust; it reduces risk, and it can drive tremendous efficiencies. We’re building a complete blockchain platform and we have already worked with over 300 clients to pioneer blockchain for business.”
- IBM is collaborating with Dubai Customs, Dubai Trade and its IT provider DUTECH, to explore the use of blockchain for a trade finance and logistics solution for the import and re-export process of goods in and out of Dubai. Taking the example of a shipment of fruit, stakeholders involved in the process will receive timely updates as the fruit is exported from India to Dubai by sea, and then manufactured into juice in Dubai, and then exported as juice from Dubai to Spain by air.