Blockchain Basics 12 – Blockchain and the Travel Industry

Blockchain Basics 12 – Blockchain and the Travel Industry

Travel and Blockchain – A Love Affair

Fastest Growing Sector Embracing Blockchain

Blockchain, the technology behind Bitcoin, and its decentralized ledger is having a love affair with forward-thinking industries, including travel. And why not? The travel industry is the fastest-growing economic sector in the world, and according to the report of the UNWTO (World Tourism Organization), it provides about 10% of the world’s GDP and 30% of total services exports. The travel industry also stores astronomical amounts of vulnerable personal information such as passports, bank accounts, and even people’s income records, making blockchain a win-win for both travelers and service providers by protecting both sides from fraud, hacking, and misuse.

When it comes to blockchain decentralized ledgers, solutions already exist in the tourism market. For example, the blockchain version of Airbnb was created by the Rentberry company. This project uses reliable and transparent smart contracts for tenant/landlord agreements. The largest city of the United Arab Emirates is hoping to stay ten steps ahead of other world competitors with Dubai’s launch of a virtual business-to-business tourism-specific marketplace using blockchain technology, with plans for an additional distribution channel hosting hotels slated for 2020. The project will require all tourist organizations involved in planning trips, pricing, and guest data to connect via blockchain to ensure transparency, open up the domestic travel industry and introduce new participants and innovative startups to the ecosystem, and more importantly, provide travelers a full view of realtime competitive cost comparisons.

Booking On The Blockchain

Today, travel services like Expedia and Priceline have come to dominate airfare bookings. Monopolies that aggregate services such as these affect costs to both travelers and airlines. Correspondingly, these “gatekeepers” tend to include hefty fees and surcharges made possible by their largely unchallenged status. Blockchain technology has the potential to shake up the travel industry. Blockchain gives airlines and hotels a way to bypass these gatekeepers to gain better access to customer data. In Germany, major players, including Lufthansa and citizenM hotels, are partnering with startups to bypass middlemen charging hefty fees and group bookings via blockchain. The blockchain resolves other challenges, by streamlining the booking processto building a more competitive system. Furthermore, in the free market competition among service providers is always a plus for consumers.

The blockchain system promises to enhance the customer experience by recording all entries on the blockchain’s immutable ledger. This reduces the likelihood of mistaken or lost bookings and reduces the layers between sellers and consumers. Moreover, the technology’s improved security features provide better protection for the ecosystem. Apart from building greater supply chain efficiencies and reducing costs for hotels, travelers will ultimately benefit from lower cost bookings. Consequently, this could also ensure that providers adhere to similar procedures for greater accountability.

Already heralded as a game changer for multiple industries, blockchain is emerging as a powerful technological force that promises to change the travel industry’s status quo.

 

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