If you haven’t noticed the blockchain buzz at #OOW17, you probably were at another conference. Blockchain demos were in two executive sessions and we had 7 additional sessions on blockchain in PaaS and Industries tracks, as well numerous other sessions on this topic delivered by partners. All of the content will be available in the OpenWorld Catalog by next week.
Two Amit Zavery sessions featured blockchain demos:
In addition, there were sessions on:
For detailed reporting on blockchain happenings at OOW17 check these 3 reports:
Sorry, but for cryptocurrency enthusiasts there were zero sessions on Bitcoin or ICOs. If you are wondering why, it’s because Oracle is focused on enterprise blockchain opportunities – helping customers enable their enterprise processes like Procurement, Payments, Trade Finance, Invoice Reconciliation, KYC/AML, Securitization, Credit/Lending, Healthcare Provider Registration, Welfare Distribution, etc. to securely share data and conduct distributed transactions with 3rd parties using blockchain cloud platform.
While Bitcoin and Ether and a number of their derivatives have caught attention for decentralized token and value trading, what’s attractive to an enterprise or a government agency about those early blockchain successes goes deeper – the underlying mechanism for multiple organizations to conduct transactions without fully trusting each other or using a centralized intermediary they all trust. Instead, the trust is derived from peer-to-peer validation protocols, commonly agreed-to business logic for smart contract transactions, endorsements using digital signatures, and cryptographically-linked, replicated data store that can’t be changed without making the tampering evident. Enterprise blockchains are about using these underlying capabilities to solve many hard problems in B2B space.
These problems exist whenever organizations need to exchange data and agree on certain updates, but lack the capability to do so in real-time without using a trusted intermediary. The cost of using an intermediary can become economically significant, and the intermediary itself can potentially be a single point of failure. Without an intermediary, the organizations often exchange data using batch files that are extracted from their systems of record to be reconciled offline (e.g., nightly batch processing) or emailing spreadsheets back and force to agree on everything from invoice reconciliation in supply chains to pricing for securitizing a batch of mortgages that are being sold by a mortgage originator to an investor. The amount of B2B interactions based on reviewing and editing spreadsheets is truly amazing, as I’ve recently learned. The promise of enterprise blockchains is that we can do better – with more real-time data sharing, more automated verification, and more consistent view of the data being shared. These problems exist in many industries – whether it be payments processing or trade matching in financial services, food ingredients tracking in farm-to-table supply chains, tracing and recall automation in manufacturing, electronic health records sharing in healthcare, and many others.
When using a trusted network for B2B transactions organizations extend and automate their operations across their partner ecosystem, accelerating transactions and optimizing business decisions with real-time information that was previously unavailable, at least not in real-time. By eliminating the cumbersome offline reconciliation of data across multiple ERP stovepipes and relying instead on a trusted shared ledger of key information companies and public agencies can reduce the cost of fraud, which often happens in the gaps between systems. As businesses and regulators increasingly begin to rely on tamper-proof business-critical records in blockchain ledgers, they can also streamline regulatory audits, turning a cumbersome and costly process into an algorithmic exercise.
With all these promises of the glorious, blockchain-enabled future, you would be right to ask how many blockchain projects have progressed to production implementations. Many organizations have run POCs and pilots using blockchain technology, and often have been able to prove the basic promise of a specific use cases – yet, very few appear to be using blockchain in production environments. Talking to people involved in the POCs, SIs, and vendors of enabling technology, one often hears about strong functional success, which, however, has not led to a production rollout. Some of the barriers undoubtedly stem from the challenge of getting multiple organizations to work together but many others are due to gaps in meeting enterprise-grade requirements that are mandatory in business-critical systems. This could mean a range of business-critical attributes, which often include:
In the next post we’ll consider some of these in detail and describe how Oracle Blockchain Cloud Service helps to deliver the most comprehensive distributed ledger platform that’s ready to help enterprises tackle the many challenges and inefficiencies that exist at the enterprise boundary and with Business-to-Business transactions.