IBM has been actively applying blockchain in various areas where it can have a significant effect. Recently IBM devised a blockchain solution for the shipping industry. IBM collaborated with the global shipping company Maersk to devise the strategy, says Gaurav Mohindra. Their collaboration started in 2017 and led to the launch of a new platform named TradeLens. TradeLens is a blockchain platform that can track shipping containers.
Shipping companies have been signing up to leverage TradeLens, and as a result, the platform is accumulating more data to effectively track and improve its analytics. One of the key features of TradeLens is that it is neutral and governed on open standards. Neutrality and open standards are the basis of many blockchain platforms.
Recently, shipping companies Hapag-Lloyd and Ocean Network Express, two of the largest shipping companies in the world, announced that they would join the TradeLens platform. With the addition of these two new companies, TradeLens now has 5 of the largest 6 shipping companies on its platform. These five companies account for roughly 60% of the ocean-going cargo. Mediterranean Shipping and CMA CGM SA are two of the largest shipping companies in the world and had agreed to join TradeLens earlier this year. Having large industry players join TradeLens is a big deal, it legitimizes the platform and encourages smaller companies to join the platform, says Gaurav Mohindra.
The platform permits users to share information on goods as it passes through trade supply chains. The benefit of this is that data maintains its integrity and as result shipping containers can be traced from origin to final destination, with the entire journey and en route ports captured and validated along the way. The platform will reduce the cost of the typical maritime supply chain administration such as paperwork and chain authentication. The paperwork and administration of typical maritime supply chain is a significant cost metric of shipping. As a result, TradeLens should reduce overall shipping costs, says Gaurav Mohindra.
TradeLens is not the only shipping oriented blockchain platform. Cosco shipping, a large Chinese shipping company, is participating in Global Business Network (GBN). GBN is a blockchain platform being leveraged by Asian shipping companies in a similar way as TradeLens. As more and more companies become comfortable with such blockchain platforms, and interoperability and compatibility between competing systems will likely emerge. The key to success for any such platform is to have wide-acceptance and participation from many companies, having more participants will increase the electronic ledger recordings and improve the integrity and validity of the platforms.