SolarWinds Q&A: Airline industry next for blockchain disruption

Two SolarWinds executives discuss the rise of blockchain in the airline industry

Every day a new use case appears to emerge for blockchain. Guy Halford-Thompson, founder and CEO of BTL Group told us recently that he believed the energy sector was especially ripe for blockchain disruption. While two SolarWinds executives, Patrick Hubbard (Head Geek) and Joe Kim (CTO), feel that the airline industry will be next. A lightly edited Q&A based on Hubbard and Kim’s composite view can be found below. 


How common do you think the use of blockchain will become in the airline industry?

Airlines, like other industries, are increasingly becoming digital businesses, and they will need to approach their problems in new, creative ways, which includes the adoption of technologies such as blockchain.

Airlines conduct various business-to-business (B2B) transactions that touch other business and government entities for every traveller’s ticket.

This means that without adopting something like blockchain, they will need to go through rigorous reconciliation processes between a multitude of systems to ensure operations and security. Use of cryptographic techniques can help provide shared ledgers and decentralise these types of reconciliation processes.


When do you think this will start to happen and when might it reach its peak?

Like most things impacting a business and/or an industry, as soon as the business pain appears, adoption will increase.

Actually, a recent blog published by Accenture illustrated the areas in which airlines could utilise blockchain to not only tokenise financial value, but apply it to other indirect values as well. These include e-tickets, loyalty programs, and data privacy.

With the value blockchain technologies give any B2B transaction, we expect peak usage within the next three years.


Will we start to see a host of startups focused on this particular area?

With large cloud providers offering blockchain as a service (BaaS), most boutique blockchain shops will be focused on blockchain as a facilitating component in larger digital transformation efforts or providing industry-specific VAR services.


Like in finance, will this mostly involve the use of private blockchains?

If Bitcoin has taught us anything it’s that blockchain-backed services are only as good as the performance of those services. If reconciliation and synchronisation of distributed private ledgers takes forever, or the private services that provide it are not correctly monitored and managed, then they will not be any more successful than any other IT project. Over time, it will be very difficult for private blockchains to meet the performance, durability, and operational costs of cloud-hosted BaaS.

Also, as companies utilise blockchain technologies beyond just financial value, it will open up additional opportunities beyond the use of only private blockchains.


What do you think the future will hold for the use of public and private blockchains?

Blockchains, and in general public acceptance of cryptographically assured assets, stand to enable new models of human interaction. Today we live in a state of background checks, credit scores, and trust-based security. If things of value and/or assets can demonstrate a state or relationship without the need for high-performance online history systems, it will free technology providers that much more to invest in innovation rather than operations.


Outside of the airline industry, what other areas do you see as large growth areas for blockchain? And on what timescale?  

We see the manufacturing, healthcare, retail, social, and entertainment industries as growth opportunities for blockchain. Essentially, anywhere B2B, or B2B-like, transactions are conducted.


What areas are being overhyped and will blockchain never be useful for (perhaps despite endless proposals to the contrary)? 

Currency mining—the idea that somehow blockchain itself is a technology that mints money. In some ways, this is responsible for a certain decrease in interest in the last twenty-four months. A certain segment of technologists has come to realise it’s not magic beans, and it’s just another enabling technology, ready for enterprise application.


What is SolarWinds’ involvement in all this?

As the public Bitcoin network has demonstrated, public and private blockchains face scaling and performance concerns as they grow. Building blockchain-based services that rely on high-throughput, low-latency transactions requires attention to these concerns.

Whether hosted in the cloud, white-labeled third party, or bundled into other systems, businesses will need to assure great end-user experience for the entire service. That exuberance will span WAN, edge, system, storage and more, and SolarWinds is uniquely able to help ensure visibility across all of these layers.


Also read:
Public vs. private blockchains: It could all prove a bit like the cloud
Ethereum wants to be the OpenStack of enterprise blockchain
Hype vs. reality: We investigate the potential in blockchain
What can Blockchain bring to security?
What’s a blockchain? And is it heading for prime time?
Could blockchain help fight the counterfeit goods racket?
Q&A: The energy sector will be next for blockchain disruption