Blockchain settlement ‘in commercial operation in 2019’, Capacity Europe hears
Key wholesale carriers are aiming to put their blockchain-based voice settlement system into commercial operation next year – perhaps as early as March 2019.
A number of carrier leaders, taking part in a panel at Capacity Europe on Wednesday, committed to 2019 as the live date for commercial transactions after a number of proofs of concept during 2018.
“Next year,” said Pierre-Louis de Guillebon, CEO of Orange International Carriers. “Next year is realistic,” agreed Eduardo Guardincerri, CMO of Telefónica.
Both were responding to a question from the panel moderator, Jussi Makela, who is director of the ITW Global Leaders’ Forum (GLF), the industry organisation that has run the proofs of concept since the project began at the 2017 Capacity Europe event. “When will you settle the first live transaction?” Makela asked the panelists.
Marc Halbfinger, chair of the GLF and CEO of PCCW Global, said: “We introduced this topic at this event one year ago. In less than 12 months look at what we’ve achieved. Instead of settling in one to three months its two to five minutes. This is a huge achievement.”
But wide adoption for blockchain based voice settlement “depends on the industry getting on board”, he said.
John Sullivan, head of global voice at Telstra, appeared more cautious. “I don’t feel we have enough data,” he said, adding nevertheless that he felt the project could go commercial “probably in March next year”.
Damien Staples, BT’s VP of global wholesale, shrugged: “I’m no fortune teller.”
Guardincerri also appeared to be cautious, suggested that the blockchain approach could be introduced gradually. “You can migrate some traffic,” he said.
Halbfinger started the session by warning that it made sense only if the approach was “adopted by the whole industry”. The GLF “wants to move forward collectively as an industry body”, he said. Before that can happen, the industry needs a common interface.
Louisa Gregory, chief of staff at Colt, said her company wanted to move to blockchain technology because “we have a large base of capital markets customers that are already looking at this technology”. Guardincerri said that Telefónica was using the project to train its staff. “Telefónica is paying you for a master’s or a PhD in blockchain,” he said. “You have to learn how blockchain will change your company from the inside out.”
Blockchain will bring “real efficiencies”, he said – and Gregory agreed, saying that wholesale voice “is still fairly manual”.
Staples said: “This is an example of how technology can change what is a legacy business. It’s not about blockchain. Blockchain is a technology and we have proven the technology can work.”
It’s needed in voice, said Sullivan. “It is a high-volume, low-margin, cash-flow business – and therefore you need fast cash flow.”
Halbfinger repeated that this years proofs of concept “were not just minimally successful, they were a resounding success”, and Staples agreed that blockchain “would take out heavy costs” from the business.
Sullivan wanted more. “We need to accelerate the proof of concept and develop it further”, suggesting the industry could try the technology for areas such as internet of things.
But the 28 members of the GLF that met in London on Monday “have to prove to their finance teams” that it is worth investing in blockchain technology, said Halbfinger. “What is the right structure that the industry needs to deliver the technology?” he asked. “How can this allow us a more dynamic settlement environment?”