The blockchain is an undeniably ingenious invention – the brainchild of a person or group of people known by the pseudonym, Satoshi Nakamoto. But since the technology emerged it has evolved into something greater – but still the main question every single person is asking is: What is Blockchain?
Research indicates that large enterprises are adopting emerging technologies like blockchain, artificial intelligence (AI), and the Internet of Things (IoT) up to ten time more than SMBs, this according to a recent report from Spiceworks.
By 2020, Spiceworks forecasts that 56% of large enterprises plan to adopt blockchain-enabled technology—up from one quarter now—according to their survey of 780 business technology buyers across North America and Europe. Looking further ahead, analyst firm Gartner predicts that blockchain technology could be worth $360B by 2026.
At that point, 86% of large enterprises also plan to adopt IoT solutions, 65% plan to deploy edge computing technology, and 64% expect to use AI, according to the report.
Asked the question, ‘Is Blockchain Hot or Not’, Chris Money, Director at Cloudstreet Consultancy, an organisation providing independent specialist resource to assist and guide clients through digital transformation projects and secure the very best outcomes, says ‘Definitely Hot’.
“I believe Blockchains and associated DApps (decentralised applications) will disrupt almost every business sector in the next 3 to 5 Years and the comms space will be no exception.”
So, what is Blockchain?
Money says, “A highly secure network of participants (peer nodes) that maintain an append-only, shared, distributed ledger or system of records. With origins in serverless Bit-torrent technology, Bitcoin was the first use case of a Blockchain. Blockchains have now evolved to support over 2000 protocols and Dapps collectively, which share a number of key components and characteristics.”
Money adds, “Also useful, but distinct are Private Blockchains which are usually adapted for internal business purposes or sandboxes. They compromise some virtues, typically by not being decentralised, in favour of ultimate control.”
Blockchain Characteristics
• Decentralised, serverless network of peers which affords resilience and removes controlling power from individuals or groups consisting or less than 51% of participants.
• Transparent and Trustless, open and built on a ‘lack of trust’ assumption, processes, transactions and historical record states are visible.
• Secure and Immutable, strong encryption protects data, and records or transactions cannot be undone.
These characteristics can be leveraged for;
• Proof of Authenticity, due to the transparency and sharing of immutable records which can be leveraged for many things such as ownership and product traceability.
• Reliability and security, without single points of failure, or being sensitive to attack, or players with additional power, they are inherently incorruptible.
• Smart contracts, essentially automated functions, enable business terms to be executed as part of the transaction or vice versa. These contracts are highly efficient and cost effective, enabling substitution of cumbersome trusted party oversight.
Questions?
Our questions are more likely to be; how can the channel become involved in this emerging market and where can you go to get up to speed with the opportunities it affords?
What are the business applications and how could they help an SMB?
Louisa Gregory, Chief of Staff at Colt Technology Services, comments, “Businesses of all sizes – especially smaller ones that may not have internal IT support teams or security professionals on site – are increasingly vulnerable to new-wave online security threats and risks.
Therefore, they’re looking for ways to conduct core business activities as securely as possible. With blockchain, the ledger is incorruptible and every verified transaction is recorded in it. It allows for verification without having to be dependent on third-parties, and because the data cannot be altered or deleted - and the technology uses protected cryptography to secure the data ledgers – means it’s an attractive option for SMBs as well as larger companies.
Blockchain can be used effectively for applications ranging from accessing cloud storage, for supply chain communications and proof of provenance. There is also practical value in using it for paying employees.
In Colt Technology Services’ case, it is a member of the ITW Global Leaders’ Forum. Last October, it announced the successful completion of a multi-lateral blockchain Proof of Concept involving several of its members. The Proof of Concept - which was led by Colt and PCCW Global utilising technology created by blockchain start up, Clear - demonstrated along with other carriers the viability of a platform that can settle voice transactions between multiple carriers in minutes, rather than hours. While that’s not necessarily an SMB application, it does show the versatility and scalability of the technology and the value it can add where transactions conducted in real-time are concerned.”
Chris Money at Cloudstreet says that if you look at the ways the blockchain attributes can be applied to our market, there is huge scope for opportunity.
“Already mobile operators are out there offering a simple efficient blockchain based contract for mobile roaming or interconnection. The opportunity exists for CSPs and providers to simplify management systems, improve identity management & fraud prevention, secure and deploy IOT and improve the accuracy and efficiency of billing systems.”
What current business applications exist–
The bulk of the current activity sits in the CSP arena now and most development seems to be focussed around; Settlement contracts between carriers and mobile operators, Fraud prevention & mobile payment.
Recent press announcements include; AT&T’s decision to accept BitPay as a payment method for crypto holders to pay their bills. Also, as an example of a non-decentralised approach Facebook has confirmed its planning to launch its own private blockchain under the guise of ‘Globalcoin’. By utilising their own private Blockchain and currency they lose some of Blockchains inherent user benefits but effectively retain all of the control.”
Lee Norvall, non-exec Technical Director at professional services company FreedomTECH, says that Blockchain in telecoms can facilitate asset management across the entire business network.
“In simple terms, a shared ledger can be accessed by all involved in the supply of communications, such as mobile phones. These could include logistics records, supplier, CSP records, regulators records, partner carriers and contractor records. Working to the core shared ledger enables speed, accuracy, compliancy, security and transparency.”
Norvell believes this could make us consider the Supply Chain Blockchain scenario where the relationships between participants, suppliers, regulators, partners, customers and even competitors in a CSP’s business network have become more complex.
“These business networks cross geographic and regulatory boundaries. Value is generated by the flow of products and services across business networks in transactions and contracts. The business network operates by transferring assets between parties. Anything that is capable of being owned or controlled to produce value is an asset.
There are two fundamental types of assets: tangible (a mobile phone, for example) and intangible (a service agreement, for example). A shared ledger is key to successfully managing assets across the network.
The key to a successful Blockchain in any given market is therefore collaboration across each member/technology provider all subscribing to and working off a single or collection of ledgers.”
How can resellers get involved and what are the additional skill sets needed?
“There are courses resellers can attend to become certified blockchain professionals, which acts to both reassure clients and to help resellers differentiate their businesses from competitors,” says Louisa Gregory at Colt.
“In terms of the training and skills needed to be proficient in blockchain, of course a technology background will be useful as many subsequent blockchain discussions with customers will centre on how it complements new or existing technology.
Being able to learn and adapt quickly will be key too, especially during these early days of the technology’s evolution. Those who are already skilled in the fields of software and systems development - or are familiar with data analytics - may already have transferable skills that are relevant to blockchain. Also, when it comes to blockchain, it’s important to not simply employ it for the sake of it. So a core skill set would be identifying if blockchain is the right technology for the problem at hand.”
Right now, is it worth the effort?
“The short-term answer is yes,” says Louisa Gregory at Colt.
“There is a role for blockchain. It may be niche now – and it may remain niche in the future – but there will be on-going demand for blockchain experts and blockchain solutions. By learning about blockchain now – even to the extent of making the effort to specialise in it – bodes wells for the future.
However, it should be noted that no technology should replace good governance. While it is likely that blockchain will shift from being niche to mainstream, during this transition, a critical learning should be what are the structures within organisations that need to be put in place to make the most of this transformative technology.”
Chris Money reminds us, “This is the 4th industrial revolution and I believe there is a huge opportunity in our market to reduce costs by improved management systems and simplified administration whilst improving customer service and combating fraud.
I expect that smart contracts will be the most significant driver of this, with the move to Everything as a Service the opportunity is there for the picking, these new efficient contracts could also be automated to include ‘pay for what you use’ rather than fixed term. Some individual Blockchain protocols can also be combined (stacked) like Lego bricks to provide more complex functionality to suit the specific sector and business needs, and we are now seeing a range of interoperability projects particularly on the Ethereum (an open-source, public, blockchain-based distributed computing platform and operating system featuring smart contract functionality) based protocols.
Is it worth it? Since Blockchain is likely to prove highly pervasive, with the concept, virtues and lessons being relatable across use cases. It is certainly worth getting an understanding of the capabilities and the fundamentals. As one person quoted ‘2018 in Blockchain years is the equivalent to 1994 to the 1996 internet boom’.”
Ed Says…
Blockchain reminds me of a disingenuous headline I wrote many years ago, ‘E=mc2 – It’s Not Rocket Science’. This might sound a bit Sgt Pepper but 20 years ago I was hosting a seminar on ISDN for a distributor and after about 30 minutes a few resellers got up and left without a word. At the end, one of the hosts told me those that had left said to him that ISDN will never catch on so it was a waste of their time being there.
So, I’m not trying sound smart here (as I’m not) but what I do know is that over the years I have been in this business (yawn) there have been many many introductions of new technologies and applications that have seemed challenging and or at best very niche. Some went on to thrive whilst others dropped by the wayside – usually because more practical solutions came along.
As Chris Money says, ‘This is the 4th Industrial Revolution’ and things do change as a result of revolutions. In our business change is constant and accelerating so what might appear to be a ‘let’s skip this page’ moment today could become the ‘must read, page turner’ of tomorrow.
Here’s a couple of links to further information on Blockchain that could be useful. Much of the information available is currently focussed on Cryptocurrencies but broader pieces do exist.
• For a simple video overview of the potential of Blockchain look here - a Ted Talk:-https://youtu.be/Pl8OlkkwRpc
• This site goes a bit deeper and has a free guide to download:-https://blog.hubspot.com/marketing/blockchain
• This site has pretty much everything:- https://blockgeeks.com/guides/what-is-blockchain-technology/
• Everything you could want to know about Bitcoin & some other resources;- https://www.lopp.net/bitcoin-information.html
• One popular Smart Contract platform is Ethereum (ethereum.org), developers can leverage the existing network and it’s security to easily build out their own use case.
• The Consensys website is worth a look if you want to see what some organisations are doing with the technology. See https://consensys.net
• Microsoft Shows Off Azure Smart Contract Auditing Tool: https://beincrypto.com/microsoft-azure-smart-contract-auditing/