Dive Brief:
- The Trusted IoT Alliance published a press release this morning announcing its official launch, describing itself as a conglomerate of companies that will develop standards for the blockchain network, organize pilot blockchain programs, and share source code for further blockchain development.
- The alliance is comprised of Fortune 500 companies including Bosch, BNY Mellon, Cisco, Chronicled, IOTA, U.S. Bank and HCM International of Foxconn Group, among others.
- The purpose of the alliance is to establish an "open source blockchain protocol to support IoT technology in major industries worldwide," according to the press release.
Dive Insight:
IBM has dominated the blockchain-in-business space for a while, partnering with other companies to further develop its blockchain network, and until now most blockchain alliances have been forged with IBM. This new alliance shows that IBM isn't the only company developing a blockchain network for business, but it also shows that businesses are pretty serious about the new tech. It's not just a buzzword anymore, it's something on which companies are willing to stake money and reputation.
The Trusted IoT Alliance plans to host annual events and hopes to create a more scalable and reliable IoT network by using blockchain. The alliance endeavors to connect physical objects — a computer, a car, a phone, or even a tagged piece of clothing like a shoe — to the Internet of Things by using blockchain, as a way of record keeping or managing inventory. The press release notes that anything internet-connected is part of the IoT and could be assimilated into this new network.
By connecting and recording physical objects into a digitized system, companies can conduct business more safely and quickly by using smart contracts.
If blockchain alliances like this one and others succeed, they will glean hefty cost savings for companies by nixing "middlemen" accounting services and providing contract guarantees and heightened security. The alliance, if successful, will also slash through the red tape swaddling business contracts and accelerate operations.
"Blockchain and IoT together create a 'sweet spot' that form an Internet of Value which allows secure
value flow across a range of industry segments," said Cisco Senior Vice President Hilton Romanski. "The Alliance is promoting interoperability which is a key factor that drives broad-scale technology adoption. This consortium will assist innovators across industries to develop transformative applications."
As companies continue to forge blockchain alliances for a variety of uses, company supply chains are likely to undergo severe overhaul. Theoretically, blockchain is good for business, but that's because companies expect blockchain to eliminate the need for many stages of the supply chain. Blockchain promises speed, security, and savings and — if it delivers — many companies will be rearranging their supply chains, which could result in supply chain disruption, delays, layoffs and losses.
"We see blockchain as a powerful technology to simplify transactions between devices and individuals
for supply chain operations, government services, IoT, banking and payments and healthcare," said Todd Moore, Senior Vice President of Encryption Products at Gemalto, one of the alliance members.
Blockchain may be good for supply chains in the long run, but as it's implemented in the short run, it's bound to shake up multiple industries worldwide.