The aviation industry is highly resilient, constantly evolving and innovating at a great pace, its willingness to embrace new technology arguably being driven by the changing demands of travellers as much as by the rapid development of the technology itself.
Every few years a new buzzword in technology arrives, bringing with it many possibilities for innovation. One of the latest is Blockchain. A new type of decentralised database that has the potential to impact the banking industry, with new crypto-currencies such as Bitcoin and Ethereum.
However, forward-thinking start-ups have begun to identify possible use cases for the technology across other industries, including travel.
The travel industry, involving as it does multiple different stakeholders in any one journey, seems to lend itself well to the adoption of Blockchain technology. This is because Blockchain relies on a network of collaborative players, all with the capacity to verify transactions for each other.
While it is early days and the roll-out of these initiatives are probably still five to seven years away; we have identified three likely use-cases for Blockchain in the travel industry, two of which are very relevant to the airport environment.
Enhance baggage handling
The first is baggage tracking. Presently, this is a complex process, which involves many decentralised players.
Indeed, the passenger must deliver the bag to the airport check-in desk or self-service bag drop counter. The bag is then processed and a message is sent to the relevant service providers, such as ground handling, to let them know the bag has been dropped off and is ready to be loaded onto the plane.
Upon arrival, this all happens again with different members of staff and, eventually, the passenger is handed back their bag and leaves the airport happy.
However, this is not always the case, and with so many steps in this process, it can be difficult to pinpoint the exact location of a bag and determine who is responsible for it at that time. This means bags can go missing and the process goes from baggage tracking, to baggage tracing.
The challenge here is that each airline and airport may have different systems, which aren’t always interoperable, so it is hard to quickly find data. But with Blockchain technology, the tracking of bags could be made far simpler.
This is because it could provide an immutable record of where the bag is on a database that could be viewed by all parties.
Not only would this speed up back-end processes, but it would also provide peace of mind for the traveller, who could potentially track their own bag, perhaps using a mobile app.
When relationships between passengers and airlines or airports are ever more important in a competitive and crowded marketplace, this kind of service could play an important role in keeping travellers happy and bolstering loyalty.
Making traveller identification
As well as keeping track of baggage, it is also – obviously – imperative for airlines and airports to know where their passengers are. Moving from booking to arrival at the destination involves the traveller passing through several touchpoints, such as check-in, boarding and arriving at the hotel, where they must identify themselves – either using their passport or boarding pass.
Imagine how much easier a journey would be if you didn’t need a passport or identification at all these points.
In recent years, much of the focus of traveller identification has been on biometrics. However, it could be possible for passengers to pass through borders using facial recognition for example, with a log of this stored on a Blockchain database.
Blockchain could offer a secure, traceable proof of location that cannot be lost, falsified or deleted by anyone.
Loyalty systems that deliver and don’t frustrate
Today, travellers are often members of various loyalty schemes with disparate points. This is predominantly for airlines and hotels, but increasingly airports are offering loyalty schemes.
This is a particular issue for business travellers, who often have little choice over which airline or airport they fly through, as this is often booked by their organisation.
And it can lead to a frustrating situation whereby a large amount of points has been built up; but the traveller finds it difficult to redeem them.
However, imagine if you could store all your loyalty points in a single digital wallet and redeem them easily whilst also sending or sharing points with friends via an app.
Blockchain could allow business travellers to share their points with their families, or frequent flyers, or to treat a friend to an otherwise unattainable trip.
By improving the underlying interoperability of disparate loyalty programmes in an automated and real-time way, Blockchain means points can be much more universal, like cash is today and therefore more likely to be redeemed.
Blockchain is exciting but is not without its limitations
While the advantages of Blockchain are clear, it is not without its limitations. The way that Blockchain technology validates transactions can be slower than other kinds of databases.
Clearly, in an airport setting where travellers are keen to get from A to B as quickly as possible and long queues can quickly lead to a backlog of work and therefore delays for the different stakeholders, speed is of the essence.
Blockchain technology is decentralised in nature, meaning it is also drastically different to the centralised cloud-based systems that most airports use today. Before this kind of radical change could be brought about, there would need to be collaboration from across the industry to see how products and services using it could be built and put into operation.
Ultimately, Blockchain technology – like all technology – is the enabler to achieve business goals not the driver.
Products should not simply be created because there is a new technology available, instead the industry must carefully consider whether this is the best mechanism for the task at hand.
It is also imperative that security and privacy considerations are taken into account and not compromised when implementing a new technology of this kind.
While clear use cases for Blockchain do exist, business requirements should drive the technology we use not the other way around, as ultimately that is how most value can be delivered to travellers.
At Amadeus, we are excited about the potential of Blockchain. However, there is still a lot of work and investment required to fully understand its potential.