Ten months ago, IBM and the world’s largest shipping company, Maersk, entered a partnership in which IBM was going to design a blockchain network to help the shipping company track its shipments and everyday transactions with the use of the distributed ledger technology (DLT). Today we take a look at how far that partnership has come and some major struggles it has and is still facing.

TradeLens, the blockchain network that was created in the partnership was meant to be a platform for other shipping powerhouses to also run their blockchain nodes. The platform wasn’t just for Maersk, but also for several other shipping giants – essentially, Maersk’s rivals – to also operate their full blockchain nodes. The real problem here is the fact that rival shipping companies are all being invited to run their business transactions on a platform created and “largely influenced” by a fellow rival. It’s just not as easy as it may sound. This is why after ten good months the platform has had only one other shipping company join it.

Pacific International Lines is the world’s 17th largest shipping agency in terms of cargo volumes. The shipping line is the only carrier enrolled unto the TradeLens network, and that’s not enough. Marvin Erdly, the head of TradeLens at IBM, admits that TradeLens needs to have more of such huge shipping agencies on it for its own benefit as he states

“I won’t mince words here – we do need to get the other carriers on the platform. Without that network, we don’t have a product. That is the reality of the situation.”

As stated earlier, other shipping companies are concerned that that Maersk may have some form of autonomy on the network should they get on board. Hapag-Lloyd and CMA CGM’s chiefs have publicly branded TradeLens as unusable by their shipping lines. TradeLens subsequently clarified its invitation to other shipping lines as a joint collaboration but this still hasn’t profited much so far.

Erdly acknowledged the concerns raised by the rival shipping firms as he mentions to CoinDesk

“Obviously the fact that Maersk is driving this is both a really good thing and a worrying thing because they are such a big player in the industry. As you can imagine that’s going to be a factor.”

He further expressed that having an advisory board in the industry was also a way to look at promoting equality on the platform.


Why Other Shippers Don’t Want On Board IBM And Maersk’s TradeLens

Maersk and IBM holding the Intellectual Property rights is, as mentioned earlier, the biggest challenge faced by TradeLens. It is “not rocket science to guess what all Maersk’s competitors said about joining this initiative” says Lars Jensen of SeaIntelligence. Lars believes that the other shipping agencies may have been genuinely interested in knowing much about the blockchain network, but the knowledge of Maersk still owning the Intellectual Property rights makes the decision not to join a no-brainer for them.

The platform presently has a wide array of ports and custom authorities, freight forwarders, cargo owners and several logistics companies from across the globe. Michael J. White of TradeLens confirmed this in a statement made.

“We have had positive engagement with companies across all sectors of our industry thus far, and we’re pleased to note that this constructive dialogue has resulted in more than 100 ecosystem participants actively involved or piloting the solution,”

He also touched on why Maersk decided not to stick with the digital system created by INTTRA but went ahead to make its own

” (it) has a fundamentally different focus and approach than INTTRA in terms of both the solution and technology. We have an ongoing dialogue with INTTRA.”

We see blockchain networks like that of Ethereum and we get pretty much excited by the prospect of creating one, however what might be neglected is the fact that these networks have taken several years to become what they are today. IBM is doing well in trying to build a blockchain network such as TradeLens, but if its is going to move towards mass adoption Jerry Cuomo of Big Blue thinks it could try either of these two options. First, build a small and centralised network and as more companies come on board as trust anchors, you gradually expand. Or, it could go the very way it’s going now – go big all at once – which will take more time to gain traction and trust anchors. He stated

“We are not sure that one is right and the other wrong. If you start off small and centralized, the challenge will be getting the next big trust anchors on board. On the other hand, with the decentralized approach, you can have multiple competitors and their lawyers all asking questions and it’s going to take some time. You’ve got to pick your poison,”

We have seen some really great blockchain developments from IBM including Food Trust which it started with Walmart. But he big question now is whether IBM and Maersk are willing to share TradeLens’ Intellectual Property Rights equally with other trust anchors who join the network if that’s what it takes for the blockchain to be a success. Marvin Erdly says he can’t give a definitive answer to that however, “We could have spent years and years working on some industry consortium model. Or we could get started and push this thing forward”, he says.

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