Blockchain technologies have the potential to transform how business-to-business transactions are conducted by providing access to a shared immutable ledger. IBM today announced it is ready to put those blockchain technologies to use in a production environment hosted on the IBM Cloud.
Brigid McDermott, vice president of blockchain business development and ecosystem for IBM, says the IBM Blockchain Platform is based on an instance of the open source Hyperledger blockchain technologies developed under the auspices of The Linux Foundation. It is priced starting at 50 cents an hour.
“We chose to standardize on Hyperledger because it provides both an open source and open governance model,” says McDermott.
IBM also announced today that one of the first applications being delivered on the platform involves a global food supply chain application developed by a consortium that includes Dole, Golden State Foods, Kroger, McCormick and Company, Nestlé, Tyson Foods and Walmart. The goal is to make it possible for growers, suppliers, processors, distributors, retailers, regulators and consumers to gain permissioned access to known and trusted information regarding the origin and state of any specific food item.
McDermott says IBM expects to apply blockchain technologies across just about every vertical industry to provide a means to provide access to a shared ledger through which organizations can verify transactions around the globe without having to rely on third-party middlemen to verify transactions. That capability has the potential to not only transform how transactions are processed within a vertical industry, but also potentially drive a wave of mergers and acquisition across disparate industries as new processes and applications become enabled, says McDermott.
IBM claims it is already working with over 400 organizations on blockchain applications. The IBM Blockchain Platform plans to expand the reach and scope of those efforts by making available blockchain technologies as a cloud service.
IBM today noted it is providing access to governance and encryption tools to manage who can see which data and which organizations can participate in a specific transaction process via the distribution of smart contracts. IBM is working on an automated billing and invoicing system based on blockchain technologies in collaboration with Lenovo that promises to provide both full traceability of billing and operational data and much faster onboarding of participants in a blockchain network.
McDermott says that latter capability is critical because unlike digital currencies such as Bitcoin that rely on blockchain technologies, the whole point of employing blockchain technologies in an enterprise setting is to provide visibility into only the transactions that any organization is specifically permissioned to see.
It’s still early days in terms of blockchain adoption. But the impact blockchain technologies will have across suites of existing ERP applications will be profound. Most existing ledger systems are not going to be usurped by blockchain databases any time soon. But there will be an almost immediate need to integrate the two to enable organizations to reconcile their internal accounting with transaction recorded in an immutable database that is likely to become the one source of trusted data that every organization can count on to be true.