The pandemic had led to panic in the airline industry, with countries closing borders, passengers preferring to defer all travel and profits plunging steeply across the airline ecosystem. It would take until 2024 for international air travel across the Asia-Pacific to reach pre-virus levels, according to IATA (International Air Transport Association).<\/p>\n
Given that inertia in the industry, is there any innovation to look forward to? Yes. One of the region\u2019s leading airlines embarked on a unique, blockchain-based project to revamp its frequent flier system as a pilot before rolling it out to other business units (BUs).<\/p>\n
Blockchain, based on the distributed ledger technology, allows organizations to streamline shared work streams \u2013 such as supply chains, logistics, and multi-modal warehouse management \u2013 by exchanging and tracking assets and transactions on a shared ledger. Blockchain is a transparent and verifiable system. As a shared, secure ledger of transactions distributed among a network of computers, blockchain limits waste, reduces the risk of fraud and enables the creation of new revenue streams.<\/p>\n
\u201cWe wanted to try out this new tech, initially with our frequent flier program, which has a few hundred thousand customers across multiple tiers,\u201d the airline\u2019s CTO said. \u201cSince we were on the Microsoft platform, we wanted to work with a partner with proven expertise on Azure and blockchain technology. We went through the trough of vendors and zeroed in on\u00a0 Cloud Kinetics (CK).\u201d<\/p>\n
In enterprise use, blockchain networks are often distributed among a group of partners (called a consortium), giving each partner real-time visibility into every transaction. Each partner also can reject incorrect transactions before they\u2019re applied to the ledger, which simplifies auditing and dramatically reduces the risk of fraud.<\/p>\n
The CK team went through the requirements and complexities. \u201cWe proposed a scalable blockchain model based on the utilization and consumption of resources,\u201d Karthik Santhanam, CK\u2019s co-founder, said. \u201cWe have been working with this airline since 2018. We knew how their BUs worked and the level of precision they wanted in the solution.\u201d<\/p>\n
CK chose ACL (Azure Confidential Ledger), a distributed ledger but one where the business logic is not centrally controlled. ACL uses Azure confidential computing capabilities, running on hardware-backed secure enclaves. It provides tamperproof data storage in scenarios where critical metadata records must not be modified, including in perpetuity for regulatory compliance and archival purposes.<\/p>\n
\u201cWe found the Ethereum-based blockchain on Azure as the ideal platform for this,\u201d Santhanam said. \u201cWe proposed a custom development keeping the airline\u2019s objectives in mind. We worked initially with Microsoft to build the development and quality assurance environment, then with the airline to move the system into production and offer our suite of managed services.\u201d<\/p>\n
The outcome? \u201cThe solution worked like a charm,\u201d the airline CTO said. \u201cIt was well integrated with production. We could scale it with multiple BUs in due course. We were glad that CK provided systems operations and support as well. Moreover, CK had to align with our IT governance and service delivery model for seamless integration.\u201d<\/p>\n
The result? \u201c The project led CK to win Microsoft\u2019s Innovative Partner of the Year award,\u201d Santhanam said. \u201cThe airline had other partners for other projects. But for this project based on Azure blockchain, CK was the only vendor. We also provided support for development, systems operations, and maintenance.\u201d<\/p>\n
New tech may help airlines bounce back from the pandemic once the recovery phase kicks in. \u201cWhile curbs are easing, a full return to normal operations is a long way off,\u201d Reuters reported on Oct 13, 2021. \u201cIATA estimates global aviation industry losses from the pandemic will be a towering US$200 billion for 2020-2022. Losses in Asia alone were close to US$50 billion in 2020. International travel in the Asia-Pacific region was at around 4% of 2019 levels in August 2021.\u201d<\/p>\n
As a footnote, Azure Blockchain Service was retired on Sept 10, 2021. \u201cCustomers are recommended to use ConsenSys\u2019 QBS (Quorum Blockchain Service) as a direct replacement, which offers expanded features and flexible deployment options for managed blockchain networks,\u201d Microsoft reported. \u201cQBS is a managed service built on technology acquired from JP Morgan Chase. It automates the deployment and management of a cloud-based blockchain network. It is a fully managed ledger service that gives enterprises the ability to operate blockchain networks at scale.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
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